It certainly hasn’t been a great 24 hours of trade for the cryptocurrency market.
Traders have been hitting the sell button in their droves today, causing the entire value of the market to fall almost 6.5% since this time yesterday to US$249 billion according to Coin Market Cap
While there have been heavy declines across the board, Bitcoin (BTC) will take the headlines with its 5.3% decline to US$6,339.64 per coin.
This has wiped US$5.9 billion off its market capitalisation, reducing it down to just under US$108.7 billion. It now accounts for 43.6% of the entire crypto market.
Why is the Bitcoin price sinking lower?
While profit taking could be weighing on cryptocurrencies such as Bitcoin, Ethereum (ETH), Ripple (XRP), Bitcoin Cash (BCH), and EOS (EOS) today, there could also be another issue impacting trader sentiment.
A report by Quartz reveals that cryptocurrency exchange giant Coinbase has seen the download rate of its app fall to the lowest level since April 2017.
According to the report, the Coinbase app has fallen to 40th place in June finance app download rankings.
While this may sound quite trivial, it is worth remembering that the crypto market has been suffering from a decline in participants this year following the significant fall in the Bitcoin price.
Without new money coming into the market, it will be hard to the Bitcoin price to ever rebound to the highs of late 2017 and early 2018. At that point the world’s largest cryptocurrency was priced at around US$19,000.
With the Coinbase app falling to a 15-month low in the rankings, it could be a sign that interest is on the decline and that would-be traders are staying away.
Similarly, another concern is the rapidly decreasing number of searches for “Bitcoin” in Google search. A quick look on Google Trends shows that searches of the term have continued to trend lower and are at their lowest level of the year currently.
While Bitcoin is far from over, I suspect that it will trade in a narrow range of US$5,000 to US$7,000 until there is a major positive catalyst. While this is great for day traders, it doesn’t make it a good investment option.