Bitcoin and the wider cryptocurrency market, including ethereum, Ripple's XRP and cardano, were hit by a sudden flash crash early Sunday morning, tanking prices (though Elon Musk's "fav" crypto dogecoin is holding steady).
The bitcoin price, which had this week been on a downward trend toward $60,000 per bitcoin, dropped more than 10% to just over $50,000. The bitcoin price has since somewhat rebounded to trade around $55,000 but remains some distance from its recent near-$65,000 highs.
Ahead of the cryptocurrency flash crash, wiping $300 billion from the combined bitcoin, ethereum, XRP, cardano and broader $2 trillion crypto market, bitcoin bull and CEO of Galaxy Digital Mike Novogratz warned of a "washout" ahead.
"In the next week, certainly we could have some volatility because of the excitement around Coinbase," Novogratz told MarketWatch this week, pointing to the much-hyped Nasdaq NDAQ +0.1% debut of bitcoin and crypto exchange Coinbase on Wednesday.
The bitcoin price climbed to almost $65,000 per bitcoin this week, up around 800% on this time last year, before crashing back early Sunday morning. The precise cause of the bitcoin and crypto price crash was not immediately clear, however, some have pointed to power outages in China knocking those that maintain the bitcoin network, known as miners, offline and unconfirmed reports of a regulatory crackdown on bitcoin and cryptocurrencies.
The long-awaited Coinbase listing also sent the price of major cryptocurrencies ethereum, Ripple's XRP, binance coin and cardano sharply higher, with dogecoin, a meme-based cryptocurrency created as a "joke," adding a staggering 400%.
"I’ve seen a lot of weird coins like dogecoin and even XRP have huge retail spikes, which means there’s a lot of frenzy right now," said Novogratz. "That never ends well, and so we’ll probably have a washout at one point."
Dogecoin, a memecoin that's seen its value soar as retail traders spurred on by Tesla TSLA +0.1% chief executive Elon Musk pile into the cryptocurrency, has surged by around 3,000% since October.
Meanwhile, XRP, a cryptocurrency controlled by the company Ripple, has rocketed 500% over the last six months despite an ongoing lawsuit brought by the U.S. Securities and Exchange Commission (SEC) accusing the company and its senior executives of misleading investors.
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