The price of Bitcoin crashed on Friday, January 21, to levels that it had not seen for more than five months, leading to further panic among investors whose enthusiasm had led the cryptocurrency to hit a historic high inĀ November last year.
The world watched as the price of Bitcoin first dropped below $40,000 for the second time this month, then slid further to go under $39,000, a level it had not seen since August 2 last year, when it had closed at $38,191.
At the time of the filing of this report, the price of a single Bitcoin was hovering around the $39,100 mark, having lost more than 40 percent of its value since its $67,582.60 peak on November 8 last year.
The dip came even as market indices across the world headed southward on global cues like inflation, supply chain crises, and the recent hawkish stance taken by the US Federal Reserve.
It also came within a day of the central bank of Russia called for a complete ban on cryptocurrencies.
The downward trend seemed to have been predicted by a recent International Monetary Fund (IMF) analysis that claimed cryptocurrency prices are increasingly moving in consonance with stock prices, meaning currencies like Bitcoin were no more the best way to hedge their bets against the vagaries of the stock-market.
“The increased and sizeable co-movement and spillovers between crypto and equity markets indicate a growing interconnectedness between the two asset classes that permits the transmission of shocks that can destabilize financial markets,” warned the IMF in its analysis, published a mere 10 days before Friday’s Bitcoin crash.
The global body suggested that it was not time for a “comprehensive, coordinated global regulatory framework to guide national regulation and supervision and mitigate the financial stability risks stemming from the crypto ecosystem.”
Twitter pokes fun
Meanwhile, cryptocurrency enthusiasts in general and those bitcoin in particular took to social media platforms like Twitter to lighten the mood amid the gloom of the dip that was encapsulated by hashtags like #cryptocrash and #BitcoinCrash.
One user had the abyss in mind:
Didn’t see it coming š¤£š¤£ #BitcoinCrash #bitcoin #cryptocurrencies pic.twitter.com/RHTEaKmWmP
ā Seyi #Polymath š (@heswaikcrypt) January 21, 2022
Another Twitter user with a darker sense of humor posted this:
Currently doing some #bitcoin research #BitcoinCrash pic.twitter.com/Tw7khzuHlC
ā Lord Norris š° (@TheEricNorris) January 21, 2022
A third user tried to look at the apparently brighter side of things with this meme:
painā¦ whoās buying the dip? #Bitcoin #cryptocrash #Crypto pic.twitter.com/ThN1EMxGZy
ā Crypto Memes (@cryptoarchivers) January 21, 2022
