A Review of Bitcoin’s Price Activity in 2023
Bitcoin is the world’s most famous and most valuable cryptocurrency. The coin brought cryptocurrencies to the masses and has been instrumental in the popularization and mainstream integration of the technology.
However, Bitcoin, like all other cryptocurrencies can be volatile and unpredictable, with wild price swings and value fluctuations. The coin has struggled in recent years, especially when compared to the days of the Bitcoin price reaching 60k. Let’s take a look back at Bitcoin’s price activity throughout 2023 before discussing what the future may hold for the coin.
The Beginning of the Year
To kick off this 2023 price review, let’s take a look at the status of Bitcoin at the start of the year, on the 1st of January 2023.
As the new year began, Bitcoin was trading at a value of $16,605. This was a meagre sum, especially compared to the heights the asset had reached in previous years and followed a months-long slump that had dogged the coin for much of the end of 2022.
Bitcoin was performing well at the start of 2022, but it soon nosedived, along with many other cryptocurrencies. The reasons behind this slump are complex and difficult to ascertain, but it likely had a lot to do with the crashing of a number of smaller coins, which eroded trust in the technology.
The war in Ukraine didn’t help either. This sent global markets into meltdown, scaring investors and seeing a reduction in spending across the board, with everything from the price of fuel to cryptocurrencies affected by the escalating geopolitical crisis.
However, in November 2022 a seismic event was to occur that would shake the crypto industry to its core and deal further damage to an already ailing Bitcoin. FTX, a major crypto exchange, dramatically collapsed, with allegations of fraud at the centre of the crisis and investors losing their entire investment.
This dealt a serious blow to the crypto sector, further damaging its reputation in the eyes of investors. The collapse of FTX was a key contributor to the struggles Bitcoin faced back at the start of 2023.
Slow and Steady Progress
Trends don’t last forever, and this is particularly apparent in the world of crypto. While this can be a disadvantage, as good times don’t last for long, it can also be a benefit. When times are tough and prices are low, investors and traders can take some solace in the fact that things could change relatively quickly.
After a difficult start to 2023, Bitcoin began to show some signs of recovery. After the tumult of the FTX collapse, the asset’s value slowly began to turn around. By the 1st of February, Bitcoin’s price had grown to $23,705, and then to $28,475 by the 1st of April.
By July, Bitcoin was trading at a price of over $31,000, the highest the coin had been since the summer of the previous year.
What was behind Bitcoin’s turn in fortunes? Again, the exact cause is difficult to pinpoint, but the collapse of Silicon Valley Bank will have played an important role. While the collapse of FTX sent Bitcoin prices tumbling, the SVB crisis had the opposite effect.
FTX was a crypto exchange, and so its collapse damaged the reputation of the larger cryptocurrency industry. SVB, on the other hand, was a traditional bank dealing with fiat currencies. As the crisis unfolded, many investors turned to cryptocurrencies like Bitcoin, which have certain attributes that make them more secure and adaptable than fiat currencies.
This helped to buoy the Bitcoin price and set it on an upward trajectory as we headed into the latter part of 2023.
The End of the Year
As the summer of 2023 drew to a close, things were looking bright for Bitcoin. If the trend continued, investors were confident that the asset would end the year in a much stronger position than it had been 12 months previously.
The cryptocurrency took a slight dip for the duration of September and into early October, hovering between $26,000 and $27,000.
It was towards the end of October that Bitcoin was to receive its biggest boost of the year. Investment company BlackRock had previously applied to the SEC to start a Bitcoin Exchange Traded Fund (ETF). While the application was made in June, it was in October that the filing popped up on the Depository Trust and Clearing Corp.’s website.
This accelerated Bitcoin’s recovery and gave investors the encouragement they needed to start spending more. The news set off a chain reaction that would see Bitcoin’s value soar as we moved through the wintertime. On the 1st of November, Bitcoin was trading at $35,440. By the 14th of December, this had risen to $42,396.
In closing
It is a fact that unpredictable market trends are nothing new in the crypto landscape. Nonetheless, they can prove extremely costly for investors, especially newcomers who aren’t accustomed to the volatility of the technology. Bitcoin was in dire straits at the beginning of the year, and crypto critics were quick to proclaim the bubble had burst for good. However, Bitcoin demonstrated durability and resilience in the face of adversity, turning things around impressively to end the year on a high note.
Watch this space for future developments, but expect to see higher highs as Bitcoin and other coins in the space gain traction with a wider investor audience.
