The Bitcoin price has recovered well in the last 2 to 3 weeks and was able to rise from $16,500 at the beginning of 2023 to more than $21,000 most recently. Nevertheless, there is still a risk that we will see one last massive crisis on the market. What event could cause bitcoin to fall below $10,000? In this article, we take a closer look at a company whose failure could cause the Bitcoin price to fall below $10,000 again.
How has the Bitcoin price moved in the last few weeks?
At the turn of the year 2022/2023, the Bitcoin price was around the $16,500 mark. In the weeks before we saw little movement on the market. But in the first days of 2023, the price was already able to rise above the $17,000 mark. Over time, resistance at $17,000 fell and bitcoin was able to surge above $18,000.
In the days that followed, the rise continued. We saw the price explode above $20,000. Furthermore, the course was recently even able to rise above the $ 21,000 mark. After that, the Bitcoin price stabilized slightly below $21,000.
Can bitcoin crash below $10,000 again?
The Bitcoin price has been able to recover more strongly in recent weeks after the FTX crash in November . It seems that the worst crisis on the market has been overcome and that the Bitcoin price cannot fall any lower than the FTX disaster .
But it doesn’t have to mean that in 2023 the worst is behind us. At the moment, the crypto market is benefiting from the good inflation figures in the USA, which are causing the major markets to rise. But there could still be certain events that could drop Bitcoin below $10,000 again.
Which company could lead to a Crypto Crash?
In the last few hours it has become known that the crypto lending service provider Genesis has to file for bankruptcy. The company’s financial difficulties had been known for a long time. Cameron Winklevoss in particular, who allegedly gave Mark Zuckerberg the idea for the Facebook platform, demanded that Gemini give back loans for his company Gemini so that it can pay out customer money. It was about $900 million.
The bigger elephant in the room, however, is Genesis’ parent company, the Digital Currency Group, or DCG for short. In addition to Genesis, DCG also owns other companies in the crypto space. In addition to the 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 had to file for bankruptcy was that the company also lacked $1.2 billion in loans from parent company DCG. Winklevoss therefore called for the resignation of DCG boss Barry Silbert. The power of the DCG is immense and their influence can be seen in the drama surrounding Genesis and Gemini.
Should the DCG run into financial difficulties, then we could see a Bitcoin crash eclipsing the FTX crash. The fact that DCG was not able to repay loans to the subsidiary on time does not reflect well on the company.
At the moment there are no clear indications that the DCG is struggling with payment difficulties. The American stock exchange supervisory authority SEC could not object to anything in the examination so far. But even with FTX there were no signs of a lack of liquidity for a long time.
Is Bitcoin Risky in 2023
The Bitcoin price saw a stronger increase in the last few weeks. However, the drama surrounding Genesis and the situation surrounding DCG shows that large conglomerates can still have a massive impact on the market. A fall of the DCG could really drop the Bitcoin price below $10,000 again.
Ultimately, as always, it is important to keep a cool head and believe in the concept and long-term functionality of Bitcoin. A drop below $10,000 would offer another extremely good chance of not buying as cheaply as afterwards.
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