Bitcoin offices in Istanbul, Türkiye, on February 28, 2024.Â
Umit Turhan Coskun | norphoto | Getty Images
Bitcoin suffered a sharp decline in overnight trading, showing that the world's largest cryptocurrency has not shaken its tendency toward major declines despite continuing to gain acceptance within the mainstream financial world.
Shown are data from Coin Metrics Bitcoin It traded at more than $72,000 late Thursday night before falling to about $67,000 on Friday, a roughly 7% decline. The price rebounded to around $68,900 on Friday afternoon.
Bitcoin fell sharply overnight after trading above $72,000 on Thursday.
It was not immediately clear why Bitcoin, which is traded 24 hours a day, declined.
Bitcoin is still up about 60% year to date, and the overnight decline came from near record highs. The value of the cryptocurrency has soared over the past few months, partly due to anticipation and then demand from new bitcoin ETFs that launched in the US in January.
“I think it's a healthy move. We're removing some of the leverage that has built up in the system,” Crypto.com CEO Chris Marszalek said on CNBC's “Squawk Box” on Friday, adding that the selling pressure was likely coming from… Options market.
Rapid rises and sharp declines have been a recurring feature in Bitcoin's history. In the previous bull market, Bitcoin rose above $68,000 in November 2021 but traded below $20,000 nearly a year later.
Crypto bulls say the volatility of the asset class should decline as bitcoin matures. The emergence of bitcoin ETFs, which make it easier for a wider range of investors to gain exposure to cryptocurrencies, could theoretically help reduce this volatility.
