Bitcoin had hit a new annual high of $45,000 last week before taking its third precipitous fall of 2023.
Bitcoin plunged to a low on Dec. 11 after a stormy period that wiped out more than 11% of the largest digital currency and sparked predictions of more volatility as the year draws to a close.
The cryptocurrency has been falling since Saturday, marking its worst performance since mid-August. The drop from nearly $45,000 also weighed on larger crypto markets.
Some analysts blamed worried speculators hedging their bets ahead of the Federal Reserve’s latest monetary policy meeting.
However, most analysts were unable to pinpoint a specific cause, describing the pullback as an expected correction given bitcoin’s 152% year-to-date gain.
According to , the recent price correction occurred as short-term holders of bitcoin took profits in statistically significant amounts, halting the rise. This comes after a period of rapid price growth in recent months.
Here’s the positive
observes that holding remains the preferred market dynamic among bitcoin investors, with mature parts of the supply remaining largely dormant.
The on-chain analytics firm notes a recent increase in the number of addresses holding over 1,000 BTC, or bitcoin whales.
An increase in whale addresses indicates that larger bitcoin investors are becoming more confident. The increase in whale addresses is related to changes in the price of bitcoin, although not necessarily in direct proportion.
The accumulation of Bitcoin by whales is beneficial because it can affect market liquidity and volatility.
