Bitcoin falls below $30,000 as 2021’s gains become a memory

(Bloomberg) – Bitcoin’s decline amid a crypto crackdown from China has pushed it below $30,000 for the first time since January, nearly pulverising its entire 2021 gain.

The original cryptocurrency has lost more than 50% from its mid-April high of almost $65,000, leaving it up marginally for the year. That compares with a 12% gain for the S&P 500 since the end of December. The coin started 2021 trading around $29,000 following a fourfold increase in 2020.

“Any meaningful break below $30,000 is going to make a lot of momentum players to throw in the towel,” said Matt Maley, chief market strategist for Miller Tabak. “Therefore, even if Bitcoin is going to change the world over the long-term, it does not mean it cannot fall back into the teens over the short-term.”

Bitcoin dropped as much as 10% to $29,333 on Tuesday, just above last year’s closing price of $28,997. Other cryptocurrencies were hit harder, with Dash tumbling 22%, XRP falling 21% and Litecoin stumbling 18%. Among more volatile DeFi tokens, Prude was down 68% and Manyswap tumbled 60%, according to data on CoinMarketCap.com.

Chart-watchers said Bitcoin, which failed to retake $40,000 last week, could have a tough time finding support in the $20,000 range following its drop below $30,000. Still, Bitcoin had prior to Tuesday breached $30,000 during at least five separate instances this year but recuperated to trade above that level each time.

It’s a remarkable comedown for the digital asset which just weeks ago was trekking higher amid a warmer embrace from Wall Street as well as retail investors. But negative press about its energy use, brought on largely by Tesla’s Elon Musk, as well as a clampdown from China have pushed it lower in recent weeks.

The $30,000 support level had held steady during a selloff last month that saw it wipe out roughly 35% for the month of May.

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