'Plunging' Bitcoin Stabilizes with Low-Price Buying... 7% Rebound After Falling Below $80,000

Bitcoin, the leading cryptocurrency that plunged after breaking below the $80,000 level, rebounded on the 28th (local time), somewhat calming the deteriorated investor sentiment.

According to the US cryptocurrency exchange Coinbase, Bitcoin was trading at $84,349 (123.4 million won) per coin at 6:57 PM that day. Although this was down 0.38% from 24 hours earlier, it represented about a 7% rebound compared to the previous day's sharp drop to around $78,100.

Bitcoin recently continued its downward trend, breaking below $80,000 as the US Federal Reserve (Fed) is expected to delay interest rate cuts and economic uncertainties are increasing due to tariff policies of the Trump administration's second term. The $78,100 level is the lowest in three months, down 27% from the all-time high recorded just before President Trump's inauguration.

Today's rebound is attributed to low-price buying following the sharp drop, along with the Personal Consumption Expenditures (PCE) price index for January announced today. The PCE price index is an inflation indicator that measures the prices paid by US residents when purchasing goods and services. It is the benchmark used by the Fed when determining whether it has achieved its monetary policy goal of "2% inflation."

The headline and core index increases announced today were 2.5% and 2.6% respectively, both in line with expert forecasts compiled by Dow Jones, somewhat easing inflation concerns.

However, despite today's rebound, Reuters reported that Bitcoin is expected to record its worst week since the collapse of FTX, the largest US cryptocurrency exchange at the time, in November 2022, with a decline of more than 11% this week.

As prices fell significantly this week, large long positions worth $387 million betting on price increases were forcibly liquidated, and a record $2.7 billion was withdrawn from Bitcoin spot ETFs until the 27th.

Amid warnings that Bitcoin's downward trend could intensify to $70,000, there are also expectations for an upward trend.

Jeffrey Kendrick, head of digital asset research at Standard Chartered, stated that despite Bitcoin's downward trend, he still expects the price to exceed $200,000.

Ethereum, which had fallen to around $2,070, was at $2,235 at the same time, and XRP (Ripple), which had fallen below $2, was trading at $2.14. Solana was at $147, up 7.60% from 24 hours earlier.

JSK@hankyung.com, Han Kyung Dot Com reporter Ko Jeong-sam