Why Bitcoin Is Going Down? (Danger Future Predictions)

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Why Bitcoin Is Going Down? (Danger Future Predictions)


Bitcoin has been witnessing crypto winter since most of 2022. Crypto markets are prone to sharp ups and downs. Given the volatile nature of crypto markets, It is usual for Bitcoin to witness minor fall and rise daily

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Bitcoin has been witnessing crypto winter since most of 2022. Crypto markets are prone to sharp ups and downs. Given the volatile nature of crypto markets, it is usual for bitcoin to witness minor fall and rise daily. However, the recent downslide crash of BTC sent investors worldwide, into turmoil. Bitcoin saw its highest point of $66,938 on November 9, over a year ago.

why bitcoin is going down

The popularity and the high number of BTC holders made bitcoin a high-demand digital asset. In November 2021, it reached its highest peak of $69,000. However, once again, the volatile nature of the cryptocurrency market was about to play its part. In June 2022, Bitcoin prices dropped to under $21,000, for the first time since 2020. This was the result of the decision of Celsius Network, a cryptocurrency bank with more than 1 million customers worldwide, to freeze its transactions and withdrawals, citing extreme market conditions.

This sent the cryptocurrency market into a meltdown and the bitcoin prices slumped over 70% to nearly about $20,000 from its peak. Since then, it has been on a downward trajectory owing to more factors like:

  1. The FTX collapse
  2. Russian-Ukraine war
  3. Increased rate of interest announced by FED.
  4. The Fall of Terra Luna.

The bitcoin price currently as of writing this stands at $16,933. It has been steady around the price of $17,000 for the last few months.

Why Bitcoin Price Fell Down and Falling:

The fall of FTX:

The fall of FTX

The most recent factor for the fall of BTC. FTX, the second-largest cryptocurrency exchange in the world, filed for bankruptcy. After a series of disputes with another crypto exchange giant, Binance. This led to the bloodbath in the market, with BTC prices falling by 80%.

What went wrong with FTX:

FTX was founded in May 2019, headquartered in the Bahamas. It has its own cryptocurrency known as the FTX token. It’s said that FTX let investors overleverage FTX token and open excessive positions. The downfall began when FTX founder Sam Bankman Fried lost 94% of his wealth overnight, losing almost $82 Billion.

On Nov 2 2022, Coindesk, a news site which specializes in crypto and digital currencies. Reported a hedge fund held by Bankman-Fried, called Alameda, to be holding unusually large amounts of FTT tokens (also called FTX tokens). Accusations surfaced, Alameda was using FTX’s customer’s deposits as loans for trading in crypto.

It’s speculated FTX was selling one token to different customers, increasing the token demand by folds in the process. It also did lend out its tokens as loans to customers, enabling them to buy more assets than their actual capital potential. The process continued and customers started buying the tokens as loans without actually pumping capital into the exchange, the token prices started skyrocketing as the demand got higher.

Things took a turn after a single tweet by the CEO of Binance, CZ. “SBF is one of the greatest fraudsters in history, he is also a master manipulator when it comes to media and key opinion leaders,” CZ tweeted. It was followed by articles posted by Coindesk on the unethical workings of FTX. These revelations triggered a panic-like state among the customers holding FTX coins. Another piece of news arrived from Binance was about to liquidate its entire FTT tokens. This sent the market into a frenzy and people started selling their FTT coins to avoid any losses.

When traders started selling their assets, FTX could not compensate them with funds, as it did not have any. Finally, On November 11, 2023, FTX founder Bankman-Fried filed for bankruptcy. The revelations sent shockwaves across the globe, popping the crypto bubble. After this, The crypto market witnessed a bloodbath, Bitcoin lost almost 71% of its price and still is limping for a recovery.

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The Depegging of Terra Luna:

The Depegging of Terra Luna

On May 25, 2022, TerraUSD also called UST lost its peg to the US dollar and wiped out support for its non-stable partner LUNA. Luna dropped to about 99%, losing billions of dollars in a matter of days. The price was $6.75 on Wednesday, which came down to $0.02 on Thursday.

Like any other market, people scrambled to exit with around $200 billion wiped out from the crypto market. All these happened to a stablecoin which was supposed to be acting as a safe haven for crypto investors. Famous Youtuber KSI lost almost $2.8 million in a day.

Terra or UST is a stablecoin whose price is linked to the dollar using algorithms. UST, an algorithmic stablecoin, used a series of smart contracts to keep its price at a dollar. It didn’t have A billion of dollars of cash or any other assets in reserves. Luna on the other hand is UST asset. While UST remains in aligned with the Dollar. Luna is more prone to fluctuations.

The price of UST depends on the value of Luna. So, how did Luna fail? Turns out that in 2022, there was a major sell-off, with customers trying to withdraw their cash, which the algorithms just could not keep up. As a result, Luna was forced to sell their Bitcoin reserves and save the stablecoin, which in turn pushed down the value of BTC.

Post-Pandemic Interest Rates:

post pandemic interest rates

The covid pandemic was followed by higher inflation rates all over the world. To curb this, banks and institutions in the US increased their interest rates. When the interest rates are increased, it becomes more difficult for individuals or companies to lend money. Which in turn reduces the money flow in the economy. This, in turn, affects the stock market and the crypto market.

Increased rates adversely affect crypto projects. The project budgets are cut down to curb the interest rates and the market’s willingness to spend decreases. Investors also lose the capacity to spend, focus more on holding the already existing assets and avoid high volatility markets such as Bitcoin.

Market Manipulation by Crypto Whales:

market manipulation by crypto whales

Whales in the crypto world are a group of people or entities. They are capable of buying large amounts of cryptocurrencies in the market. Whales can potentially manipulate the market by buying large quantities of crypto coins, increasing their price in the process, and then mass selling the coin. This can trigger a sell-off in the market. Whales can also spread FUD (fear, uncertainty, doubt) in the market to manipulate market conditions.

Will Bitcoin Recover in 2023?

will bitcoin recover

Due to the extremely volatile nature of bitcoin, it’s difficult to predict the extent of recovery it might go through or even plummet to a greater extent. The market trend, however, is optimistic of a bullish turn in the bitcoin market pattern. The bullish market trend is a four-year market cycle, which consists of buying, an uptrend, selling, and a downtrend. The bitcoin bull coincides with this trend. It is believed the market has been in a downtrend and will see a rise in market valuation by mid-2023. “ #Bitcoin Very Close to a possible bullish Weekly RSI breakout …” stated Kevin Svenson, a crypto Analyst.

Optimists are taking the example of 2017 when Bitcoin price jumped from $3,726 to a whopping $19,650. The market witnessed a bullish trend after a steady period of bitcoin prices floating around the $3,000 mark year-round. This is prompting optimistic traders now, to be hopeful of a bullish market. So far, in the midst of these, The crypto industry has somehow managed to endure the storm and show signs of recovery, even in difficult times.

The data from Glassnode, the tracking metrics of Glassnode is said to have been tracking the on-chain behavior of investors and selling paces. The metrics are showing reduction in factors that trigger sharp sell-offs. Glassnode Analyst found the subsiding of on-chain losses of bitcoin prices.

Most promising Cryptocurrency Projects To Watch Out For In 2023

C+Charge (CCHG):

C+ charge(CCHG)

 It is building a robust peer2peer(P2P) payment system for electric vehicles, electric vehicles have huge potential to grow in the future. Hence, the CCHG token has a good potential to see an increase in value. It is now on presale.


Fight Out FGHT

This platform is related to the fitness domain. In it, users can earn bonus to reach their fitness goals even faster. Fitness is an ever-growing industry with lots of potential in the future. The FGHT token is now available on presale.


Dash 2 trade (D2T)

Dash 2 Trade is a crypto analytics platform for traders. It provides trading signals, social analytics on-chain data, social sentiment and crypto signals to maximize your profits.



It is a project that will work to reduce carbon footprint. The project has great growth potential. It has raised $20 million during presale and its token is now listed on LBank.


Battle Infinity (IBAT)

It is a gaming platform which hosts multiple P2P battle games. It offers its players with immersive Metaverse world, to play and battle. In battle Arena, you can do pretty much anything in a virtual world.

In Conclusion:

The world is divided on the future of Bitcoin this year. However, there are concrete evidence, Bitcoin may peak in the midst of this year or later, It is advised to take extra care if you are planning to invest in crypto markets. Bitcoin is still the most popular cryptocurrency in the world, and there are various other emerging platforms that show promising potential for growth this year.

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