Why Bitcoin Tanked Last Week

TL;DR

• Bitcoin started last week at around $29.5k and get as low as $25.8k by Thursday afternoon, and there are a few theories as to why.

• Unnamed ‘experts’ told Decrypt: “A lot of it has to do with the wider economy—including American regulation and institutional investors being unsure”

• Some think the crash was caused after a report from the Wall Street Journal claimed Elon Musk’s SpaceX wrote down the value of its Bitcoin holdings.

• Others point to the fact that China’s Evergrande Group (aka the backbone of the Chinese housing market) filed for Chapter 15 bankruptcy protection in New York.

• Here’s your daily dose of hopium: this sudden drop in price isn’t great – but Bitcoin is still up $10k (or roughly 60%) this year.

Full Story

In case you missed it:

Last Friday, we wrote an entire article on how Bitcoin had become less volatile (in price) than oil.

…only for Bitcoin’s price to erratically tank 20 mins before we hit ‘schedule email.’

(“When you make plans, God smiles” and all that…)

So what the hell happened?

How did Bitcoin start last week at around $29.5k and get as low as $25.8k by Thursday afternoon?

No one can say for sure, but we went out and rounded up the three most common theories for you.

We’ve split them into ‘boring n’ logical,’ ‘scandalous miscommunication,’ and ‘a problem that’s bigger than crypto.’

1. Boring n’ logical:

   Unnamed ‘experts’ told Decrypt:

   “A lot of it has to do with the wider economy—including American regulation and institutional investors being unsure”

   That, and there’s less money floating around the space.

2. Scandalous miscommunication:

   The crash was caused after a report from the Wall Street Journal claimed Elon Musk’s SpaceX wrote down the value of its Bitcoin holdings.

   Which then led to a bunch of headlines claiming that SpaceX had liquidated its entire Bitcoin holdings.

   Writing-down = reporting something has lost value.

   Liquidating = selling stuff.

   Two very different things!

3. A problem that’s bigger than crypto:

   China’s Evergrande Group (aka the backbone of the Chinese housing market) filed for Chapter 15 bankruptcy protection in New York.

   That’s not a rumor – that actually happened.

   Whether all of this is the reason for the BTC crash?

   We have no idea.

Now, here’s your daily dose of hopium:

This sudden drop in price isn’t great – but Bitcoin is still up $10k (or roughly 60%) this year.

Not bad for a bear market!