By John Ikani
Bitcoin continued to slide after a broader stock sell-off in the U.S. last week sent the cryptocurrency market into a frenzy.
The world’s largest cryptocurrency, bitcoin, fell to $34,656 on Sunday afternoon, a 3.9% drop from Friday evening, according to prices from CoinDesk.
The value of the pioneering cryptocurrency was lower by about 3% at 33,594.50 early Monday, according to data from CoinDesk.
Bitcoin is now trading at its lowest level since late January. The virtual currency has been trading in a narrow range this year as it attempts to reclaim its highs of late 2021.
It is now down more than 50% from its peak price of $68,990.90 in November 2021.
Unfavorable outlooks on the market based on hard data have led the Bitcoin Fear and Greed Index to drop to 11, the “Extreme Fear” region. The index rates the general amount of fear or greed among Bitcoin investors.
The drop comes after the blue-chip Dow Jones Industrial Average lost more than 1,000 points on Thursday and the Nasdaq plunged by 5%. Those losses marked the worst single-day drops since 2020. The Dow and Nasdaq fell again on Friday.
Also, institutional investors shed $133 million worth of Bitcoin investment products two weeks ago, marking the largest week of outflows since June last year, as Bitcoin’s price tumbles below $38,000 over fears of the impending U.S. Federal Reserve’s interest rate hike.
Despite the poor sentiment, BTC daily transactions do not yet appear to have been negatively affected. According to on-chain data from YCharts, there were 233,892 daily transactions worth about $30 billion on May 8, which is the normal average since January.
Market analyst, Caleb Franzen tweeted on Sunday that investors should look for markets to continue trending downward based on his analysis suggesting we will remain “short-term bearish.” He concluded by stating that it “seems worthwhile to expect more pain.”
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