Bitcoin price continued to fall, trading near $46,000 after a sharp drop by more than 6% a day ago
Bitcoin price continues to fall, trading near $47,000 after plummeting more than 6% a day ago. At the time of writing, BTC is changing hands at $46,560.
BTC/USD 4-hour chart | Source: TradingView
Bitcoin price trades near $46,000
The number one cryptocurrency by market capitalization had another low daily volume across centralized exchanges due to the year-end holiday season. The center of the market is still at the expiry of the options contract on December 31.
A total of 124,700 options contracts worth nearly $6 billion are set to expire on Friday, according to data provided by Skew. Options are hedging instruments that give the purchaser the right but not the obligation to buy the underlying asset at a predetermined price on or before a specific date.
At the same time, smart contract platforms Algorand (ALGO) and Near (NEAR) led the biggest daily gains during U.S. trading hours. ALGO’s gains came after Algorand Foundation announced a liquidity incentive program with Algorand’s first algorithmic money market and stablecoin protocol Algofi.
“There are several signs to watch as Bitcoin has dropped back to $47.5k in 2021’s final week. The good: Sentiment shows bearishness, traders in pain, derivatives staying low. The bad: Whales profit-taking, circulation down”, Santiment stated.
With Bitcoin’s price falling to as low as $46,500, losing over 8% in the last three days the anticipation of a New Year rally seemed to wither away. A move under the $50,000 support triggered selling which was followed by another price pullback under the $47,000 support where Bitcoin traded at the time of writing.
But in a recent interview with Fox Business, in another development, Brock Pierce, one of the wealthiest people within the cryptocurrency industry, said that he would not be surprised if the Bitcoin price hit $100,000 next year. He adds that it’s “conceivable” for him that the flagship coin could even break above $200,000.
“It’s even conceivable that it could break $200,000 for a moment and come falling back again”, he predicts that the top cryptocurrency could briefly reach the aforementioned price mark before retracing lower.
Pierce doesn’t view Bitcoin as a gold-like hedge against inflation since it has more risk and volatility. He believes that Bitcoin fulfills the role of a store of value, while altcoins help the industry to move forward. With that being said, he believes that many projects won’t survive, comparing the current state of the market to that of the internet in the 90s.
Historically, the market saw 32% supply-in-loss at $29K bottom in July, while currently, 26% of the BTC supply is in the ‘loss’ territory. Nonetheless, some long-term holders haven’t touched their BTC in over five years, with over 23% of BTC’s 21 million supply remaining untouched in the period.
For now, long-term holders marginally trimmed their BTC positions in recent weeks, despite prices falling by almost $20,000, or -24.4%, since the BTC ATH. The supply held by investors only dropped to 13.3 million from 13.4 million, a small change relative to the sharp price drop.
The overall cryptocurrency market cap stands at $2.179 trillion, and Bitcoin Dominance is 40.4%.
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