Cryptocurrency <\/p>\n
Bitcoin continues to trade around the $20,000 mark, keeping investors on edge about where the price is going next.<\/p>\n
Nurphoto | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n
Bitcoin<\/a> jumped on Monday, after the cryptocurrency fell below its 2017 high over the weekend, but investors remained on edge thanks to a slew of negative crypto headlines and macro factors keeping pressure on sentiment.<\/p>\n The world’s largest cryptocurrency by market cap climbed above the $20,000 mark for much of the day Monday. However, it last edged lower by less than 1% to $20,005.46, according to Coin Metrics. Over the weekend, bitcoin fell as low as $17,601.58. Meanwhile, ether<\/a> inched higher by less than 1% to $1,102.86.<\/p>\n While investors will welcome the rebound, bitcoin still sits 70% below its all-time high, hit in November. It’s down 57% year-to-date. Many have suggested a market bottom could be close, but with so much economic uncertainty remaining, bitcoin still has more downside potential, according to Yuya Hasegawa, a crypto market analyst at Japanese bitcoin exchange Bitbank.<\/p>\n “Bitcoin’s weekend dip was, to put it simply, not deep enough,” he said. “The macro environment has not really changed from last week’s FOMC meeting: there still has not been a clear sign of inflation coming down and the Fed may still drive the economy into recession by raising rates too aggressively or simply by failing to tame inflation.”<\/p>\n<\/div>\n With bitcoin unable to hold convincingly above $20,000, industry watchers said the rally might be short-lived.<\/p>\n Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, told CNBC that unless the price of bitcoin closes above $23,000 on a daily time frame basis, “the odds are this is a dead cat bounce.”<\/p>\n “We’re oversold, so a bounce was expected,” he added.<\/p>\n<\/div>\n The broader cryptocurrency market has been plagued by a number of issues<\/a> in recent weeks, beginning with the collapse of algorithmic stablecoin terraUSD<\/a> and associated token luna.<\/p>\n Attention has now turned to crypto lending companies that promise users high yields for depositing their digital coins. Last week, Celsius, a company with 1.7 million customers and nearly $12 billion of crypto assets under management, paused withdrawal of funds for customers, sparking concerns that it is insolvent<\/a>.<\/p>\n Cryptocurrency companies have announced rounds of layoffs amid the market downturn. Coinbase, a crypto wallet and exchange, said last week it will cut 18% of full-time jobs<\/a>. A lending firm called BlockFi said last week it will lay off a fifth of its staff<\/a>.<\/p>\n Macroeconomic factors including high inflation and upcoming rate hikes from the U.S. Federal Reserve are also weighing on the market.<\/p>\n “When inflation is on the doorstep and with rate hikes in the offing, the risks of a recession round the bend are high,” Charles Hayter, CEO of CryptoCompare, told CNBC via email.<\/p>\n “The push me pull you of higher rates sapping cash from mortgaged house owners means people are psychologically bracing and paring back and digital assets are suffering thus.”<\/p>\n “Coupled with this, the pull back in the digital asset ecosystem has uncovered a number of systemic issues.”<\/p>\n<\/div>\n Given the big fall in cryptocurrency prices in the last few weeks, some observers said that a bottom to the market could be close.<\/p>\nCryptocurrency <\/a>‘Dead cat bounce’<\/h2>\n
Cryptocurrency <\/a>Market bottom?<\/h2>\n