On June 18, a horrific crash took place in the currency circle.
"I didn't expect that Bitcoin would also catch up with the 618 discount! After a nap, it dropped by almost 20,000 yuan, and now even the principal has been lost." Investor Li Jie (pseudonym) said.
At around 2:50 pm on the 18th, Beijing time, Bitcoin suddenly plummeted, falling by nearly $1,000 within 10 minutes. Afterwards, it successively fell below the US$20,000 and US$19,000 levels, reaching the lowest level since December 2020. Binance data shows that at around 5 p.m., the price of Bitcoin was reported at $18,996, down nearly 10% from the previous trading day.
Image source: Binance
Virtual currency The market has been shaken
This week, Bitcoin has been experiencing frequent diving prices, and the bullish defense front collapsed at the first touch. Looking at the long-term perspective, since hitting a record high price of $68,928.9 in November last year, Bitcoin has entered a volatile downward channel, with a decline of more than 72% so far. This means that if investors bought 3 Bitcoins at the high point at the end of last year, they would have lost nearly one million yuan today.
currency industry data shows that as of 21:00 on June 18, Beijing time, virtual currency contracts liquidated nearly 2 billion yuan in one day, affecting 60,000 people, of which the largest single liquidation was as high as 28.68 million yuan.
Image source: Binjie
Binance data shows that as of 21:00 on June 18, the price of Bitcoin was reported at $19,181, down nearly 9% from the previous trading day.
Image source: Binance
According to CoinGecko’s price data, the total market value of virtual currencies has fallen below US$900 billion and is currently US$886.44 billion, with a 24-hour trading volume of US$749,242,71,393. The current market value of Bitcoin accounts for 41.7%. In the past month, as many as 72 of the top 100 virtual currencies by market value have fallen by more than 90% from their historical highs.
Bitcoin enters its darkest moment
Glassnode analysis pointed out that the Bitcoin market has entered a stage consistent with the deepest and darkest bear market cycle in the past, and the fundamentals of on-chain transaction volume are further deteriorating. Historically, this phase takes approximately 8-24 months to pass as the market finally bottoms out.
The market has different opinions on the reasons for the decline. Ouyi Research Institute pointed out that there are many factors affecting the recent market decline. One of the main factors is that the US CPI index hit a 40-year high, exceeding market expectations, and the Federal Reserve raised interest rates For the virtual currency market, it means capital outflow, which is reflected in the continued decline of currency prices. The second factor is that an institution went crazy and sold a large amount of stETH coins (stETH, "Lido Stake Ethereum", is a project that specifically provides users with Ethereum liquidity staking services), causing the price of Ethereum to plummet, which in turn triggered a series of collapses.
Yu Jianing, executive director of the Metaverse Industry Committee of the China Mobile Communications Association, Yu Jianing told reporters that based on previous experience, the high point of the last bull market ($19,798) is a more critical support level. Because in the previous bull-bear conversion cycle of Bitcoin, the bottom of the bear market has never fallen below the high point of the previous bull market. If it breaks down from the position of $19,798, many historical laws will fail, and the market may experience a further sharp retracement.
The mining machine loses money when it is turned on
Miners who rely heavily on currency prices also suffered heavy losses, and many people in the mining circle complained.
A miner told reporters that as the price of virtual currencies plummeted, the shipments and operating income of mining machine manufacturers were greatly affected.
Co-director and researcher Pan and Lin of the Digital Economy and Financial Innovation Research Center of the International Joint Business School of Zhejiang University said that because Bitcoin is the guarantee for the issuance of many other virtual currencies, other virtual currencies will also inevitably experience a chain reaction of substantial declines. In addition, the situation in the mining circle is still unclear. It mainly depends on the actual cost of mining by miners. When miners cannot make ends meet, the suspension of production in the mining circle will become the norm.
F2pool data shows that with Bitcoin falling below 20,000 US dollars, based on the electricity cost of 0.4 yuan/kWh and based on the current mining difficulty, most mining machines including Shenma M21 and Avalon 1066 Pro have reached the shutdown price ( The cost price of mining), that is, you will lose money when you start up. In addition, Antminer T17, Antminer T17e, Avalon 1146 Pro and other mining machines are currently close to shutdown currency prices.
Picture source: F2pool
Editor: Song Zhaoqing Zhang Jing
