After dipping to a low of $19,939 early Wednesday morning, the BTC-USD is struggling to find support above the $20,000 mark.
The day's trading comes at the end of a painful last two months during which investors have seen the total market cap shrink by 47%, from $2.1 trillion on May 1 to $891 billion as of Wednesday afternoon.
The company, MicroStrategy MSTR, purchased $9.9 million worth of bitcoins between May 3 and June 28 at an average price of $20,817, according to the move in bitcoins bull Michael Saylor. The company has spent some $3.98 billion buying the digital currency, acquiring it at an average purchase price of approximately $30,664 per bitcoin, including fees and expenses, per its latest filing with the SEC.
Saylor said in an interview with Yahoo Finance last Friday that he believes that if you look out four years and base your decision on fundamentals, you can conclude thatBitcoin is the right choice for a treasury reserve asset.
Following the $50 billion collapse of the Terra and its token LUNA and UST, a number of firms are financially running aground, including the Three Arrows Capital, which entered liquidation on Wednesday. These liquidations have dampened sentiment across the space.
Since the beginning of 2022, some of the strongest critics of bitcoin have stated that it doesn't fulfill the role that advocates claim it serves, such as an inflation hedge or store of value.
More recently, Brent Donnelly, a global macro trader and president ofSpectra Markets, suggested that the world's largest criptocurrency acts as a hedge against inflation, rather than as a loose monetary and fiscal policy.
My two sons have a younger son, and that is why it's younger. This is the first cycle of the bitcoins that features institutional adoption, so we should not be 100% certain that the next cycle will look the same as this one. Donnelly noted that the long-standing relationship between the Fed policy and stocks is somewhat unstable.