NEW YORK (CNBC) - Bitcoin jumped on Monday and was teetering around the $20,000 mark, keeping investors on edge after the cryptocurrency fell below its 2017 high over the weekend.
The world’s largest cryptocurrency by market cap gained 6.8% over the past 24 hours, according to Coin Metrics, and was last trading at $20,706.00. Over the weekend, Bitcoin fell as low as $17,601.58.
Meanwhile, ether jumped 9% over 24 hours, to $1,107.39.
While the rebound will be welcome by investors, Bitcoin still sits 70% below its all-time high, hit in November. It’s down 57% year-to-date. Many have suggested a market bottom could be close, but with so much economic uncertainty remaining, Bitcoin still has more downside potential, according to Yuya Hasegawa, a crypto market analyst at Japanese Bitcoin exchange Bitbank.
“Bitcoin’s weekend dip was, to put it simply, not deep enough,” he said. “The macro environment has not really changed from last week’s FOMC meeting: there still has not been a clear sign of inflation coming down and the Fed may still drive the economy into recession by raising rates too aggressively or simply by failing to tame inflation.”
With Bitcoin unable to hold convincingly above $20,000, industry watchers said the rally might be short-lived.
The broader cryptocurrency market has been plagued by a number of issues in recent weeks, beginning with the collapse of algorithmic stablecoin terraUSD and associated token luna.
Attention has now turned to crypto lending companies that promise users high yields for depositing their digital coins. Last week, Celsius, a company with 1.7 million customers and nearly $12 billion of crypto assets under management, paused withdrawal of funds for customers, sparking concerns that it is insolvent.
Cryptocurrency companies have announced rounds of layoffs amid the market downturn. Coinbase, a crypto wallet and exchange, said last week it will cut 18% of full-time jobs. A lending firm called BlockFi said last week it will lay off a fifth of its staff.
Macroeconomic factors including high inflation and upcoming rate hikes from the U.S. Federal Reserve are also weighing on the market.