Bitcoin continues slide, but investor activity still at record levels
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Bitcoin’s (BTC) price slumped over the course of the week, dropping by $1327 to $13,930.
BTC behaved with less volatility compared to last week. The assets market value ranged between a high of $15,398 to a low of $13,511 on BTC Markets.
As the price fluctuated, so too did the total digital asset market capitalisation. It hit a high of $415.7bn on Monday night only to come back to $382.9bn on Friday. BTC dominance sits at 66.5 per cent.
BTC’s price dropped by $795 to $14,138 early Thursday morning.
The 5.3 per cent crash was a knee-jerk reaction to reports of a previously dormant wallet address re-activating after 11 years.
The wallet transferred 50 BTC to various addresses, spooking traders as speculation grew that an early adopter of the digital asset was selling their position.
Market value continued to fall on Thursday to close the day at $13,800. This move brought BTC’s weekly percentage loss to 8.74 per cent. It was trading at $13,889 at 12pm, Friday May 22 on BTC Markets.
BTC failed to break the significant $10,000 ($15,289) mark this week.
Efforts to push prices above this level on US exchanges were snubbed at $9,957, having only knocked on the ten-thousand-dollar door last week.
$10,000 is an important psychological level for BTC traders as it symbolises market strength.
Prices were last above $10,000 in February. This was just before financial markets crashed due to the emerging COVID-19 pandemic.
As BTC moved lower over the week, so too did major alt coins Ethereum (ETH), Ripple (XRP) and Litecoin (LTC).
OmiseGo’s (OMG) price surged 64 per cent this week, as US-based exchange Coinbase Pro announced it would be listing the asset to trade. OMG is a payments service which operates over the ETH blockchain network.
Records were broken this week as several BTC derivative exchanges posted all-time-high open interest (OI) on their futures and options contract markets.
These contracts allow investors to trade BTC’s future price trajectory. OI is the total amount of outstanding contracts that are yet to be settled.
Data from analytical firm skew.com shows that Chicago Mercantile Exchange (CME) recorded new all-time highs on both its options and futures markets, reaching $US179m and $US539m respectively.
This record was eclipsed by BTC derivatives exchange Deribit, whose options markets reached a total OI of $US1bn for the first time.