Bitcoin is having a very rough week. The value of the cryptocurrency got crushed again on Thursday, and in the past 48 hours has fallen over 10% and had billions of dollars wiped from the crypto market.
After the 8% drop on Thursday, a single coins value fell below $32,000 for the first time since January 11, which is $10,000 below its high less than three weeks ago.
The big question is why the value is dropping so significantly this week, and one analyst told CNBC that it’s most likely just a natural connection and not part of a bigger issue. “Corrections are a natural part of any market and are especially natural in the bitcoin ecosystem,” said Michael Sonnenshein of Grayscale Investments. ”From 2016-2017, we experienced 6 corrections of approximately 30% or more on the way to new highs.”
Bitcoin has some company in their misery, as cryptocurrency in general is having a disastrous week. In the past two days over $100 billion of value has been shed from the market. It was as high as $1.07 trillion and by noon Eastern on Thursday it has plummeted to $918 billion.
Former White House communications director Anthony Caramucci, the founder of SkyBridge Capital shared an interesting analogy with CNBC Thursday about the roller coaster ride investors are experiencing with crypto. “I think you’ve got to accept there’s a tremendous amount of volatility in bitcoin, and it’s still very early stages.”
“Imagine Amazon, and Jeff Bezos and a few venture capitalists are still holding most of Amazon, and the company is experiencing explosive growth, exponential activity. If you look at Amazon in the first 3 years, you saw 50% drops in price. Bitcoin’s moves are akin to that because you’ve got close holders of bitcoin that are releasing bitcoin to the marketplace and the buying stability is shoring up. But it’s still not 100% there.”