It’s another week of losses for cryptocurrencies as the digital currency market continues its steady slide from what analysts say had been an overbought status.
Bitcoin () was trading at $6,427.17 at around 4 p.m. EDT Friday, according to ThirtyK data provided by , down 14 percent from a week before. The cryptocurrency on Wednesday fell to $6,247.97, a low for the week. That’s well below the 2018 high of more than $17,000 in January. Nevertheless, the cryptocurrency is still up more than 80 percent year over year.
Other cryptocurrencies were also down for the week. Ether () had fallen to $357.40 at 4 p.m. EDT, a 15.5 percent decline from a week earlier, and litecoin () had slid to $61.83, down 22.3 percent on the week.
Mark Dukas, an analyst at bitcoin.live, tells ThirtyK he sees Wednesday’s bitcoin price drop as an overreaction. So long as the price can hold at $5,777, he says, “I think today’s investors will be fruitfully rewarded in the coming months.” If that level is breached, however, Dukas sees the current bear market lasting another couple of months before the trend reverses.
Dukas sees the market as a buy. “During the bearish times is when you do the executing to invest in yourself and to start to lay your bricks,” he says.
More Noise, Less Signal
Most of the recent price action is “noise, and not a lot of signal,” , a bitcoin developer, educator and entrepreneur based in Austin, Texas, tells ThirtyK. “Part of what’s happened in the last year is that the market got really overheated on a lot of hype. It was overbought, and it’s come back down.”
Continuing to fuel the price slide have been more delays in the Securities and Exchange Commission’s decision on a proposed bitcoin exchange-traded fund, or ETF. Last month, the SEC rejected a bid by Cameron and Tyler Winklevoss, who founded crypto exchange Gemini, to list the first-ever cryptocurrency ETF on a regulated exchange.
Investors are looking at bitcoin ETFs as the saving grace for this current bear market,” Dukas says.
“We have fallen too much, too fast,” he says. Vays is looking for bitcoin to climb as high as $7,000 before falling back to $5,000.
A major theme for cryptocurrencies, says Song, is whether the array of coins are delivering on their promises. Bitcoin, for one, has delivered, while other cryptocurrencies have fallen short, he says.
Ethereum, Song notes, has yet to fulfill its promise of switching to a proof of stake (PoS) methodology.
“The coins that will get value are the ones that actually prove that can deliver on something,” says Song. “That’s the stage of market we’re in. The value prop for bitcoin is obvious. If it stays rare, the more confidence people will have and the price will go up.”
Dukas says, “the fundamentals of bitcoin haven’t gotten worse, they’ve gotten better,” also citing improvements in added layers of technology, like the Lightning Network.