Bitcoin makes a brilliant comeback after a price collapse

Price hunters were on the prowl and caused a temporary change in mood, said expert Timo Emden from Emden Research. The current recovery fits into the overall picture of a “crash in installments”, in which sharp sales and technical countermovements alternated without the structural uncertainties having yet been eliminated.

Call for reliable signals

However, investors should still not feel safe, warned Emden. A credible change in mood now requires more than hope. Reliable signals are required that the market can actually cope with this cutback.

At the end of January, Bitcoin began to decline, with its price falling by up to $30,000. According to analyst Jonathan Osswald from DZ Bank, no single event was decisive for the decline. Rather, the interaction of several factors caused selling pressure, including the lack of demand from large institutional investors. In addition, general investor uncertainty and the leverage of derivatives transactions accelerated Bitcoin’s decline.

Record high at $126,000

Since reaching a record high of around $126,000 last October, the value of Bitcoin has temporarily halved. On Thursday, the price fell by over 13 percent, which, according to data from the financial news agency Bloomberg, corresponds to the largest daily loss since November 2022. There have been similar extreme price movements several times in the history of Bitcoin. They highlight the high risks associated with purchasing cryptocurrencies.