- Bitcoin Drops to $8,730 as Sell Pressure Mounts
The world’s most dominant cryptocurrency Bitcoin failed to break the $10,000 resistance level anticipated by most traders despite its third halving.
After a week of hovering between $9500 and $9,933 price levels, Bitcoin finally declined to $8908 on Thursday after an unknown person sold off over 31 Bitcoins or $300,000 worth of coins.
The coin has continued to establish lower lows since then and broke the $8730 support level on Monday during the Asian trading session as more sellers sell their holdings.
Experts have attributed part of the current sell pressure to the activity of miners that are now selling more Bitcoins given that the breakeven cost of mining a BTC is above $12,000, higher than the current price of a Bitcoin. The cost implications of mining a unit Bitcoin has surged since the block reward was halved to 6.25 coins on May 12, 2020.
Also, this could be due to exchange companies usually with substantial coins but now forced to sell some of the holdings to take care of operational costs amid rising global uncertainties and drop in activities on their platforms.
Willy Woo, a cryptocurrency investor, said “There’s only two unmatched sell pressures on the market. (1) Miners who dilute the supply and sell onto the market, this is the hidden tax via monetary inflation. And (2) the exchanges who tax the traders and sell onto the market.”
As shown in the chart above, a close below $8730 support level would open up $8231 support and further sell pressure could see the coin trading at about $7130 a coin by the end of the week.
