Bitcoin, the world’s largest cryptocurrency, has rebounded from a 16-month low after a volatile week that wiped $200 billion off the market value of the cryptocurrency.
Bitcoin last rose 4.85% to $29,925, recovering from $25,000, the lowest level the digital currency has reached since December 2020, and although it climbed to nearly $31,000 on Friday, it remains well below the previous week’s level of around $40,000.
Ether, the second largest cryptocurrency in terms of market capitalization, also gained, climbing 6.48% to $2,051. Tether was back at $1 after falling to 95 cents on Thursday. However, TerraUSD, another stablecoin is down at 14 cents.
Overall, crypto’s market capitalization rose 6.6 percent on Friday to $1.35 trillion.
Experts say high inflation and fear of high interest rates have led investors to sell risky assets, which they believe is causing cryptocurrency to plummet in value.
While crypto may be on the rise, experts fear the worst is yet to come, with Stifel chief equity strategist Barry Bannister saying bitcoin has another downside to about $15,000.
“Bitcoin is also GDP-sensitive, because bitcoin falls when the PMI Manufacturing index drops, as we expect (into the third quarter of 2022), indicating that a last, capitulatory bitcoin drop may be still ahead,” Bannister said.
The sources for this piece include an article in Reuters.