Over the past few weeks, a lot of new people have begun looking at blockchain technology. Today's a federal holiday for folk in the U.S., and so a lot of them woke up today with plans to research or invest in Bitcoin and potentially other blockchain assets, and now they're seeing that the price is "plummeting."
What gives?
(This will be a brief explanation, mostly for folk who don't know much about market economics.)
What we're seeing is what old-school investors call a "funding consolidation," where "the market," as an abstract entity, is shifting around its capital to prepare itself for new action. Picture a cat settling back on its haunches, ready to pounce on some new interest.
As institutional investors and retail traders prepare for the next phase of market action, they sell some assets and purchase others. This can cause other events to trigger... such as triggering the buy and sell limits for leveraged investors.
A "leveraged investor" is a euphemistic way of saying 'someone who's investing money they took out on credit.' These investors usually have a specific timeframe and rate of profit on trades they need to meet, in order for their leveraging to be net profit for their portfolio.
These leveraged investors, as the price got closer to $50,000, high above the position they bought into, sold. This caused the price to drop, which caused people who leveraged in at high price points to sell at a loss, which pushed the price down even further.
(The same thing is happening across the "altcoin" world too, to a greater effect because of the lower volume.)
Sometimes, pressure from buyers can counter-act these kind of sell-offs, quite quickly, to the point where they don't cause a notable dip. Pressure such as from institutional investors... who have already taken their long positions in Bitcoin and have no intention of stepping back due to a little volatility.
In short, the volume of trading on Bitcoin has been decreasing over the past couple weeks, which has led to a price-correction, downward, as the market consolidates around institutional investors and long-term holders.
Typically, these consolidations are followed by tremendous "bull runs," or upswings in the price of the assets. So if you were planning on teaching yourself about blockchain today, you might not need to change those plans.