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MW Bitcoin's nosedive through the $20,000 mark is a Minsky Moment for crypto: 'Psychologically for a lot of people, this is galling'
Mark DeCambre
'Bitcoin has already broken down [and is] now seeing significant downside follow-through,' says Katie Stockton of Fairlead Strategies. Bitcoin believer Yves Lamoureux of Lamoureux & Co., though, thinks 'bitcoin is fine.'
Is bitcoin facing a breaking point? That's what some investors, acolytes and otherwise, might be contemplating, as the cryptocurrency's descent accelerates over the weekend. The world's No. 1 digital asset was last trading at $18,654, down more than 70% from its peak of around $65,000, with the broader crypto market feeling to some as if it were in free fall.
"Psychologically for a lot of people this is galling," said Charles Hayter, chief executive officer of CryptoCompare, a company that provides data and analytics about the crypto market.
Hayter, speaking to MarketWatch in a weekend interview, allowed that the risks inherent in bitcoin are part of its appeal.
Yves Lamoureux, the bitcoin-bullish president of Montreal-based macroeconomic research firm Lamoureux & Co., said that debt swirling around in the crypto market has amplified recent swings lower, with a number of highly indebted companies facing margin calls and this arcane business's version of Wall Street bank runs. "If my read is correct, this is massive liquidation of huge leverage in the system," said Lamoureux.
"It's too easy as usual because bitcoin has this way of over [extending]," he said.
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