Investing.com - Bitcoin extended losses amid a general correction in cryptocurrencies on Wednesday, dashing hopes that digital asset could hold gains that pushed it above $9,000 just last week.
Bitcoin traded down 3.1% to $7,776.00 on the Investing.com Index as of 10:07 AM ET (14:07 GMT), a 14% correction from the 2019 high of $9,045.90 reached only last Thursday.
Cryptocurrencies overall have seen a similar correction, with the total coin market capitalization at $247.82 billion at the time of writing, compared to $272.50 billion when bitcoin peaked.
Some attributed the plunge to a “bitcoin whale” dumping a large holding of the largest digital asset, only to buy it back again at a lower price. With sizable holdings of bitcoin, the bitcoin whales are notorious for causing wild swings in the market when they take a noticeable position in either direction.
With traders accustomed to wild swings in crypto assets, Alexander Kuptsikevich, analyst at FxPro Financial Services, said that the correction was nothing to panic about … yet.
He explained that a typical correction is about 30% and so bitcoin could drop as far as $6,300.
“This is a very sharp decline for the classical markets, but it is unlikely that it will seriously frighten investors who have repeatedly encountered such high volatility,” he said.
To the contrary, he suggested that a further decline to $7,000 could even attract buyers who were waiting to enter the market at a discount after the correction ran its course.
Despite the recent price decline, bitcoin remains well above its early-May lows, when it was trading at around $5,500, before staging a rally that saw it record its best month since August 2017.
In other digital currency trading, XRP slid 4.7% to $0.39805, Ethereum fell 3.0% to $243.48, while Litecoin traded down 2.8% to $102.89.