Why the Bitcoin Price is Falling (And What It Means for You)

Since hitting a high of almost $20,000 in July, the Bitcoin price has fallen significantly. In early September, it dropped below $6000 for the first time in over a year. Many people see this as evidence of a bubble bursting and potential end of the crypto boom. Is the Bitcoin price fall sign that we’re in a crypto bear market? Does this mean you should sell your Bitcoins now before they become worthless? Or is this just another example of how volatile the world of cryptocurrency can be? Let’s take a look at why the Bitcoin price is falling and what it means for you as an investor or potential investor.

What Caused the Bitcoin Price to Drop?

The first thing we need to understand is why the Bitcoin price has fallen so significantly over the past few months. There are a few main reasons for this, including: – Loss of Institutional Interest – While Bitcoin is still relatively new and few institutions have made significant moves into the crypto market, it was expected that this would change in 2021. When Bakkt, Fidelity, and other institutions launch their crypto trading products, more people will be able to easily buy Bitcoin and other cryptocurrencies. However, this institutional interest has been delayed. This is largely due to the fact that the major regulatory bodies tasked with regulating the crypto markets, including the SEC and FINRA, have yet to finalize their rules and guidelines surrounding crypto trading. As a result, most institutional investors are holding off on investing in the crypto market until they have a better understanding of the regulatory environment. – Increased Scrutiny of Crypto – Another factor that has contributed to the sell-off in the crypto market is the increased scrutiny on these assets. While many investors have lost money on crypto, some have made significant gains. Many of these investors have been trying to cash out, leading to a drop in the crypto markets. This has also caused government regulators to begin to crack down on the crypto markets, particularly in the United States. – Asian Trading and Bitcoin Mining Issues – Finally, many people believe that the fall in the Bitcoin price is due to the fact that cryptocurrency mining operations in China are shutting down due to the country’s new power usage regulations. This has significantly reduced the amount of computing power available to mine Bitcoin, which has contributed to the price drop. Additionally, the Chinese government has been cracking down on trading, leading to a reduction in Asian demand for Bitcoin and other cryptocurrencies.