Bitcoin dipped below $26,000 in the early hours of today, Thursday, May 12, owing in part to the fiat-backed stablecoin Tether ($USDT) losing its peg. However, both $USDT and Bitcoin are currently looking healthy.
According to TradingView statistics, the Bitcoin price has dropped to roughly $25,499 on crypto exchange Bitstamp, the lowest it has been since December 2020. Bitcoin is currently selling at roughly $27,510.
As CryptoCompare pointed out, one of the main reasons for the dip appears to be a temporary de-pegging of $USDT, as the weighted average price of $USDT across numerous top-tier exchanges plummeted as low as $0.9511.
Speaking on Bitcoin’s recent price activity, Peter L. Brandt, a veteran trader and one of the world’s most respected traditional chartists, notes thus via its official Twitter page:
“This is the type of volume spike that can indicate puke-out capitulation and the beginning of the end of the one-year decline. Can the carnage continue? Anything is possible — and that includes a local bottom. I’ve mentioned 27,000 area as possible low, and that could be $BTC.”
In April, cryptocurrency markets fell, with Bitcoin and Ethereum dropping 17.3 percent and 16.9 percent, respectively. The prolonged macroeconomic instability following the war in Eastern Europe, as well as rising inflation rates around the world, has caused these declines.
According to CryptoCompare, the drop in bitcoin spot volume transferred into fiat currencies could also be explained by a rise in the popularity of stablecoins as investors moved into the area to take advantage of yield opportunities.
Similarly, we reported earlier this month that Coinbase lost over $593m Bitcoin in 24 hours, as BTC ETF inflows, then Bitcoin traded for $36,331, suffering an 8% down.
Consequently, given the latest development, Michael J. Saylor, Co-Founder, Chairman, and CEO of a Nasdaq-listed business intelligence company, noted that the bitcoin price is set by those with more money and less knowledge than you. In time, they will get the knowledge and you will get the money.