Yesterday, the Bitcoin price fell by thousands of dollars in one fell swoop and briefly traded below the level of $64,000.
That decline seemed to be the result of renewed conflict in the Middle East and concerns about the Chinese economy. However, according to some analysts, this has marked the bottom for Bitcoin.
In any case, the price is currently trading just above $64,000 again.
Has the bottom been reached for Bitcoin?
Daan Crypto Trades, a popular analyst on Twitter, points to the “healthy” state of funding rates as an important basis for the Bitcoin price to continue to climb.
The funding rates are the prices that traders pay for Bitcoin futures, which allow people to gamble, as it were, with borrowed money on Bitcoin price increases or decreases.
When funding rates are high, it is relatively expensive to buy futures and this is usually the case when the market is extremely bullish. Now that extreme has disappeared and it is again relatively cheap to take futures on Bitcoin.
According to Daan Crypto Trades, this forms a good foundation for new Bitcoin price increases.
Concerns about the Chinese economy
Furthermore, new concerns about the Chinese economy seem to explain the price falls we saw yesterday. A new report from S&P Global Ratings shows that many Chinese corporate loans are potentially in the danger zone.
This is the result of high financing costs, while the Chinese economy is currently also experiencing some problems. A total of $1.1 trillion in debt is maturing in China this year, which companies now have to refinance at higher interest rates.
Analysts now worry that the problems in China will drain liquidity from the market, ultimately reducing the amount of money available for Bitcoin and other investments.
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