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Bitcoin Price Prediction as BTC Falls to $20,000 Support – Time to Buy the Dip?


Bitcoin Price Prediction as BTC Falls to $20,000 Support – Time to Buy the Dip?

Bitcoin, the world’s leading cryptocurrency, suffered a major decline, hitting its lowest value in two months. Ether, the second most valuable cryptocurrency, followed a similar path and also saw a decline in value.

On March 10, Bitcoin briefly fell below $20,000 for the first time in nearly two months, hitting a low of $19,918.

The decline in cryptocurrency prices can be attributed to a variety of factors, including remarks by US Fed Chairman Jerome Powell, Joe Biden’s budget proposal, and the recent closure of Silvergate Bank.

As a result, falling cryptocurrency prices are worrying investors and the industry as a whole. Moreover, the fact that the total market capitalization of all cryptocurrencies has fallen below $1 trillion is a clear indication that the overall market is going through a tough time.

The Collapse of Silvergate Bank and Its Impact on the Crypto Industry

The recent closure of Silvergate Bank is seen as one of the main reasons for the drop in cryptocurrency values. The bank has played a crucial role in providing services to crypto businesses in the United States. Therefore, its shutdown could have a significant negative impact on the crypto industry.

Indeed, the closure of Silvergate Bank could hamper the development of the cryptocurrency industry, as it provided essential banking services to these companies.

The bank’s suite of services, such as custody, wire transfers, and escrow deposits, were essential for many cryptocurrency businesses. Without such support, it could be difficult for these companies to find other banking partners offering similar services, which could ultimately hinder the growth of the sector.

US crypto miners could face a 30% tax on electricity costs

The publication of an explanatory document on the supplementary budget on March 9 was another factor contributing to the decline in the price of Bitcoin. The document revealed that as part of a Biden budget proposal to “reduce mining activity,” U.S. crypto miners could potentially face a 30% tax on electricity costs.

If implemented, this proposal could have a significant impact on the crypto mining industry, as it relies heavily on low electricity costs. A reduction in mining activity in the United States could have negative implications for the entire crypto market.

Crypto Market Cap Drops Below $1 Trillion

The substantial decline in the price of Bitcoin has significantly affected the entire crypto market, once again driving the global crypto market capitalization below $1 trillion.

Other widely used altcoins such as Ethereum, Dogecoin, and Litecoin also suffered substantial losses across the board.

This indicates that the cryptocurrency market remains volatile and subject to unpredictable fluctuations, as demonstrated by the current difficult times for global crypto values.

Impact of US Fed Chairman’s comments

Jerome Powell’s statements on inflation and interest rates had a significant impact on the cryptocurrency market. Its recent announcement that the central bank may start raising interest rates sooner than expected sparked investor concern over the potential impact on the economy and cryptocurrencies, driving down the prices of cryptocurrencies. cryptocurrencies.

Powell’s remarks continued to negatively impact the cryptocurrency market for the second day in a row, adding to pre-existing concerns and worries about the regulatory environment and the future of cryptocurrencies.

bitcoin price

Bitcoin’s current live price is $19,938, with a 24-hour trading volume of $43 billion. Over the past 24 hours, Bitcoin has declined by 8.50%. It is currently ranked #1 on CoinMarketCap, with a live market capitalization of $385 billion.

Technical analysis of Bitcoin indicates a strong bearish trend for the BTC/USD pair as it broke through the $20,350 double bottom support level. Bitcoin’s immediate support level is $18,430. A break below this level may intensify the selling pressure, leading to a further decline towards the $16,400 level.

Bitcoin price chart – Source: Tradingview

Conversely, the initial resistance level is $20,300, with a break above it likely to trigger buying pressure and push Bitcoin price towards the $21,400 level. If there is further bullish momentum, the price of BTC may hit the $25,000 mark.

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Joanna Swanson

Joanna Swanson is Europe correspondent at the Thomson Reuters Foundation based in Brussels covering politics, culture, business, climate change, society, economies and inclusive tech. With specific focus in breaking news, she has covered some of the world's most significant stories.