Bitcoin fell below $9,000 for the first time in two weeks on Friday, a drop of 4.4 percent. Even so, at $8,800 Bitcoin is worth more than twice what it was at the beginning of the year. The leading cryptocurrency saw a $2,000 surge in October after an announcement from Chinese President Xi Jinping that his country now regarded blockchain as a “core” technology, revealing hundreds of blockchain projects already underway in China.
But China’s embrace of blockchain is not necessarily a boon for Bitcoin, as Digital Asset Research co-founder Greg Cipolaro explained.
“My opinion is that that wasn’t the right read of that news,” Cipolaro said, according to Coindesk. “They were clearly saying blockchain not bitcoin. … You really haven’t seen follow-through on the price. There hasn’t been a major catalyst post that $2,000 rip two weeks ago.”
Analysts are warning that the recent dip is the beginning of a downward trend. According to an assessment in Bloomberg:
“The GTI Vera Convergence Divergence Indicator shows a narrowing gap between the signal and vera lines, which suggests a trend change may be on the horizon. If this occurs, the largest digital currency could retest the lows seen before its rampant run following comments by China’s President Xi Jinping in October.”
Predictably, gold advocate and crypto skeptic Peter Schiff seized on Bitcoin’s sudden drop, arguing that “it looks like the Bitcoin pump is finally over” and advising people to “get ready for the dump.” Schiff later asserted that “Bitcoin is never going to hit $100,000.”
NekoZ, a popular Bitcoin analyst on Twitter, put it this way:
“Bullish volume looks extremely weak, I expect a drop down still. Bloody Mondays are typical, which would coincide with this further drop. HTF I am still bearish, not as much as before but still bearish.”