Bitcoin price has rebounded well in the last 2 to 3 weeks and has managed to climb from $16,500 at the beginning of 2023 to just over $21,000. However, there is still a risk of seeing one last major crisis in the market. What event could cause Bitcoin to drop below $10,000? Crypto expert Rudy Fares is taking a closer look at a company whose failure could cause the Bitcoin price to drop below $10,000 again.
How has the Bitcoin price moved over the past few weeks?
cryptocoin.comAs you follow, at the beginning of 2023, the price of Bitcoin was around $ 16,500. We have seen very little movement in the market in the previous weeks. However, in the first days of 2023, the price has already managed to climb above $17,000. Over time, the $17,000 resistance fell and Bitcoin rallied above $18,000.
The rise continued in the following days. We saw the price jump above $20,000. Moreover, BTC even managed to climb above the $21,000 mark recently. After that, BTC price stabilized at just under $22,000.
Can Bitcoin drop below $10,000 again?
BTC price has been able to recover more strongly in recent weeks after the FTX crash in November. It seems that the worst crisis in the market is over and the BTC price will not fall further than the FTX disaster. But that doesn’t mean the worst is over in 2023. At the moment, the crypto market is benefiting from good inflation figures that have led major markets in the US to rise. However, there may still be certain events that could bring Bitcoin back below $10,000.
Which company could lead to a crypto crash?
In the past few hours, it has been learned that crypto loan service provider Genesis has to file for bankruptcy. The company’s financial woes have long been known. Specifically, Cameron Winklevoss, who allegedly gave Mark Zuckerberg the idea for the Facebook platform, demanded that Gemini return the loans for his own company, Gemini, so that he could pay the customer money. This amount was approximately 900 million dollars.
The bigger elephant in the room, however, is Genesis’ parent company, Digital Currency Group (DCG). In addition to Genesis, DCG also owns other companies in the crypto space. In addition to news site Coindesk and numerous other crypto companies, these include the Grayscale Bitcoin Trust, which holds a total of 600 million Bitcoins.
What are the consequences if DCG crashes?
One reason Genesis filed for bankruptcy was that the company was also unable to repay the $1.2 billion loan from parent company DCG. Winklevoss therefore requested the resignation of DCG boss Barry Silbert. DCG’s power is immense, and their influence can be seen in the drama surrounding Genesis and Gemini. If DCG runs into financial difficulties, we could see a Bitcoin crash that eclipses the FTX crash. The fact that DCG could not repay the loans given to the subsidiary on time did not reflect well on the company.
There is currently no clear indication that DCG is struggling with payment difficulties. The American stock market supervisory agency, the SEC, has not objected to anything in the review so far. But even with FTX there was no sign of lack of liquidity for a long time.
Is Bitcoin risky in 2023?
Bitcoin price has seen a stronger rise over the past few weeks. However, the drama surrounding Genesis and the situation surrounding DCG suggest that large holdings can still have a huge impact on the market. A drop of DCG could push BTC price back below $10,000.
Ultimately, as always, it’s important to keep your cool and believe in the concept of Bitcoin and its long-term functionality. A drop below $10,000 would offer another extremely good chance to buy cheap.
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