(Bloomberg) – Bitcoin has been grinding lower in a trading range just above $30,000, prompting cryptocurrency insiders to flag the round number as a potential floor for the virtual coin.
Crypto prognostication is fraught with risk, not least because Bitcoin’s price has roughly halved from a record high three months ago. Even so, some in the industry are coalescing around $30,000 as a support point, citing clues from options activity and recent trading habits.
In options, $30,000 is the most-sold downside strike price for July and August, signaling confidence among such traders that the level will hold, according to Delta Exchange, a crypto derivatives exchange. It “should provide a strong support to the market,” Chief Executive Officer Pankaj Balani said.
Traders are also trying to take advantage of price ranges, including buying between $30,000 and $32,000 and selling in the $34,000 to $36,000 zone, Todd Morakis, co-founder of digital-finance product and service provider JST Capital, said in emailed comments, adding that “the market at the moment seems to paying attention more to bad news than good.”
Bitcoin has been hit by many setbacks of late, including China’s regulatory crackdown — partly over concerns about high energy consumption by crypto miners — and progress in central bank digital-currency projects that could squeeze private coins. The creator of meme-token Dogecoin recently lambasted crypto as basically a sham, and the appetite for speculation is generally in retreat.
Bitcoin traded around $31,600 as of 9:26 a.m. in London and is down about 6% so far this week. It’s still up more than 200% over the past 12 months, despite a rout in calendar 2021.
Konstantin Richter, chief executive officer and founder of Blockdaemon, a blockchain infrastructure provider, holds out hope for institutional demand, arguing Bitcoin would have to drop below $20,000 before institutions start questioning “the validity of the space.”
“If it goes down fast, it can go up fast,” he said in an interview. “That’s just what crypto is.”