Bitcoin is continuing on its downward slide and dropped below $6,990 level. While crypto influencer, investor, and economist, Tuur Demeester shares a number of reasons that reflects no new highs for Bitcoin price for the rest of the year. While he is bullish on long term, he says short term price needs caution, however, it’s not a foregone conclusion altogether.
Bitcoin trading at $6,980, BTC dominance slides down
Bitcoin has been constantly on a downward trend since the end of last month. On June 30, the Bitcoin price has been at $8,261. At the time of writing, Bitcoin has been changing hands at $6,980. In about a week, the price has dropped down approximately 15 percent.
The world’s leading cryptocurrency’s market cap has dropped down to $120 billion and its daily trading volume also took a hit and fell to $3.7 billion. Bitcoin Dominance has been continuously on the rise for about a fortnight and reached the year’s highest at 48.6%. The price drop has it slide down as well to the 47.4 percent.
Among the top 10 cryptocurrencies, only Cardano (ADA) and Tether (USDT) are in the green while every other coin is also experiencing the red. However, a number of altcoins like Ethereum Classic (ETC) by 4.54%, Zcash (ZEN) by 3.35%, MOAC (MOAC) by 12.57%, Holo (HOT) by 17.80%, and Polymath (POLY) by 5.45% are on rising.
Long term bullish but short term price needs caution- Tuur Demeester
Tuur Demeester, a crypto influencer, investor, and economist has shared his insights into why he believes Bitcoin is not going to beat last year’s high:
“Despite an already six month cool-off period, for 2018 we see more sideways and downside potential in the Bitcoin price due to sluggish retail demand, hesitation from institutions, and a current market cap that seems too high relative to on-chain activity.”advertisement
However, he is certainly “very bullish on Bitcoin’s long term prospects, we do heed caution for more short term price optimism.”
The first reason for no highs is a steep decline in mining profitability:
“..a 90% drop in 7 months (altcoins have faced similar or steeper declines). With profit margins under heavy pressure, it’s not unlikely that miners are and will stay responsible for a significant amount of selling in the market.”
The trading volumes are also down along with the retail interest which is going sluggish. Furthermore, institutional investors have yet to get comfortable with available custody solutions while Bitcoin ETF is not expected to get approved before 2019, he explains.
“The market likely needs more time to absorb the recent 30 month rally, which could produce lower prices. We don’t foresee new all time highs in Bitcoin for 2018.”
However, he also shares that Bitcoin price can hit new numbers as BTC dominance has gained strength, the price has already dropped 62% since December and Bitcoin reward halving that will cut the inflation. The drop in Chinese Yuan could shift Chinese capital into Bitcoin as well.