Wednesday, November 30

Bitcoin relaxes its volatility after the big drop

The bitcoin it continues to draw broad profit and loss candles on the same day, but its volatility in the last week has relaxed after a hyperbolic drop in the sessions before the December bridge.

If at that time the reference cryptocurrency lost a fifth of its value in a single day, falling as much as 22 percent from $ 47,405 to $ 41,967, now it closes the seven-day chart with a slight stabilization.

From December 7 to December 13, bitcoin lost around 3 percent, a figure that reached 4 percent intraday on a Monday that the cryptocurrency opened at $ 49,960, and that at five in the afternoon, european time, left at $ 47,630.

A negative result but one of unusual tranquility for an asset used to extreme volatility.

Stabilization after the serious fall

The national director of Bitpanda in Spain, Alejandro Zala, considers that fears about the spread of the omicron variant of Covid 19 “added fuel to the fire,” increasing market movements during the bitcoin crash.

He advocates, however, making peace with this volatility and understanding that corrections are a natural part of his behavior.

“It is true that both traditional financial markets and digital asset markets experienced a major selloff following news that a more infectious variant of Covid-19 has settled in South Africa and some parts of Europe“says Zala.

“Last year we saw that the crypto market was not immune to the pandemic either. Just as the stock market fell, crypto fell due to this situation. So we could say that the uncertainty of the pandemic and also of the new variants have an effect. sure, “he adds.

The person in charge of Bitpanda in Spain considers, however, that bitcoin has consolidated this year as “gold 2.0”, asserting its position as “a haven of value and a tool against inflation.”

Zala therefore continues to rely on the “great resilience” of cryptocurrencies, and indicates that although it is not his style to “play fortune teller”, digital assets have great long-term potential.

The search for the identity of bitcoin

This value as a refuge that Zala assigns to bitcoin, however, has been questioned by some traditional investors, who saw in the last and sharp fall of the cryptocurrency a sign of the failure in its objective of being a protection for investors against inflation. .

And this confirmation or rejection of his identity is precisely what Julie Chariell questions in her analysis for Bloomberg Intelligence, where she states that bitcoin “enters adolescence” in 2022 when it turns 13.

“Bitcoin will turn 13 in 2022, entering adolescence marked by greater independence (decentralization), certain rebellion (volatility) and the formation of an identity (store of value or medium of exchange),” says Chariell.

“With some discipline (regulation), cryptocurrencies can achieve peer acceptance (widespread adoption) and make significant contributions (DeFi, NFT),” he adds.

Factors that can help the success of cryptocurrency

In this confirmation of the identity of bitcoin, which some experts like Zala see clear while funds like UBS question, a factor that can help to finish positioning the currency is the adoption of crypto assets by the United States, which since Bloomberg Intelligence is seen as “probable”.

In the eyes of analyst Mike McGlone, proper regulation can have positive implications for prices, leading him to define the future of bitcoin as a global digital collateral asset, with key support “around $ 40,000 and resistance. in the $ 100,000 “going into next year.