Changpeng Zhao, CEO of Binance, the world’s largest cryptocurrency exchange by means of trading volumes, said that the recent decline in Bitcoin’s price is historically normal.
Bitcoin (BTC), the world’s largest cryptocurrency by market capitalization, has reached recently reached its’ three-month low. At press time, Bitcoin was trading at $6,795.30 according to CoinMarketCap, which marks 6.38% decline in the last 24 hours.
Despite the price drop, the CEO of the largest cryptocurrency exchange remains calm, noting that there’s nothing abnormal about the current price correction.
Many people seems to think BTC price was flat before this year, as they appear to be on the graph. To the old timers, it's the same pattern every year. Just the units on the left is different. pic.twitter.com/mwu8U3jn0J
— CZ (@cz_binance) June 10, 2018
In his tweet, Zhao shared a few graphs which show significant similarities in the behavior of the world’s largest cryptocurrency. However, he also notes that despite these substantial price corrections, the key factor to account for is the substantial progress of Bitcoin’s price throughout the years, referring to the “units on the left”.
Claims With Merit
In Zhao’s tweet, people can see the movement of Bitcoin from 2012 onward. Taking a closer look at the numbers shows that ever since 2010, Bitcoin has regularly gone through corrections even larger than the current decline.
In 2010 BTC went on to lose 94% of its value from the 14th of September until the 8th of November.
In 2011, Bitcoin’s price dropped from $32 on the 8th of August to $2 on the 17th of November, marking another 94% blow.
On the 30th of November in 2013, it traded for $1166 only to drop down to $170 more than a year later on the 14th of January, 2015, marking another substantial 85% decrease.
Bitcoin’s 2018 all-time-high (ATH) was on January 7th, when it traded for $17,579 according to CoinMarketCap. This means that since then BTC has lost approximately 61% of its value.
A Common Outcome
Whether or not Bitcoin will continue to freefall or it has already reached rock bottom is something that only time will show. Well-known analyst Tone Vays said that $4975 is an “optimistic” bear market price scenario while permabull Tom Lee seems to hold his ground firm on $25k year-end price.
However, if there is something that history tells us it’s that regardless of how big of a hit it takes, Bitcoin’s price always recovers, and each time it does it better than before.
Do you think Bitcoin is setting up for a new rally and a potential new ATH? Let us know in the comments below!
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