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Bitcoin (BTC) fell below $30,000 on May 10 as both traditional financial markets and cryptocurrencies sold off due to the U.S. Federal Reserve's strong monetary tightening problems as well as concerns about an economic slowdown.
The latest drop has left Bitcoin at a 10-month low and its lowest price this year.
The last time the largest cryptocurrency by Market Capitalization fell below the $30,000 threshold was on July 20, 2021, when it reached $29,301 before recovering from growth.
BTC down: What are the experts saying?
Edward Moya, senior market analyst at Oanda, said: "The recent cryptocurrency price slide is entirely based on a sell-off led by technology stocks and is not a fundamental for cryptoverse. This bearish momentum may take Bitcoin back to $28,500, but that may start when some long-term bets come into play. The long-term fundamentals still apply to bitcoin, but a return to record highs will take a long time. Bitcoin will start to stabilize when the fierce competition on Wall Street is over and many investors are still in a sell-off."
Steven McClurg, chief investment officer and co-founder of Valkyrie, said: "If the Fed continues to raise rates until June and July, we will likely continue to face a downward market throughout the summer. However, my expectation is that by the upcoming midterm elections in November, we will likely see the Fed pause or even lower interest rates starting at its September meeting, so that will be the catalyst. We can see the market going up again at that point. "
Jeff Dorman, chief investment officer at Arca, wrote in a report: "This is just a buyer's attack at the final rate and it remains to be seen what (if any) will bring buyers back."
This month, the Federal Reserve raised its benchmark interest rate by 50 basis points (0.5 percentage points) and is likely to do so again at its next meeting in June.
Bitcoin's fall in price is part of a market-wide sell-off.
All three major stock market indexes fell, with the S&P 500 now trading down 3.2% at 3991. The tech-heavy Nasdaq and the Dow Jones Industrial Average also traded lower, at 11,623, or -4.5% and 32,245, -2%.
According to data firm Kaiko, as part of this market sell-off, the correlation between bitcoin and the Nasdaq hit an all-time high of 0.8. This is considered a strong favorable correlation.
