Making sense of crypto market crash: Bitcoin [BTC] tumbles, other coins follow suit
It took the overall crypto market just a span of two hours for a mysterious tumble in prices. The total market capitalization is down by $12 billion and the crypto market features a sea of red. Bitcoin exhibited a decline of over 5% and is yet to recover. Akin to Bitcoin, other currencies are also experiencing losses. Sadly, most other coins lost well above 10%, unlike Bitcoin.
The cryptic crypto market crash
Even though there was no major incident that could have possibly slackened the crypto market performance, a slew of speculations has erupted in the wake of the crash. Two of these speculations point to crypto regulations, which have proved to be detrimental to the loosely regulated crypto industry in the past.
The first speculation puts the finger on the financial giant Goldman Sachs. Goldman Sachs which was in talks of opening a cryptocurrency trading desk abandoned its plans hinting at the condition of cryptocurrency regulations. The company seems to be waiting for a regulated cryptocurrency industry before progressing further into the cryptocurrency market.
The second crypto regulatory news which hit the industry yesterday was a report by European Union [EU] finance ministers which tightened the noose around the cryptocurrency industry of EU. The ministers stated in the report that an EU level regulation on cryptocurrencies and 'clearer' rules for ICOs will help control the risks of the evolving industry.
The final speculation revolves around the Mt. Gox hack where Bitcoin investors lost large sums of money from the exchange platform causing the exchange to shut down in 2014. Mt.Gox creditors recently filed rehabilitation claims to get their funds back. The claim valued at $400 million will be given to the investors in the form of Bitcoin Cash and Bitcoin assets. As a report suggests, Mt.Gox's trustee in bankruptcy has been noticed selling enormous portions of cryptocurrency over the past few months which, according to speculations, is driving the Bitcoin prices down.
Bitcoin [BTC] Technical Analysis
BTC plunged to trade below the $700 mark. The prices broke out from the first support level traced at $6992.5 and are currently testing the support at $6917.7. The current resistance level is set at $7319.4. The 100 EMA line is exhibiting a downtrend with the MACD signifying a severe bearish momentum. Some experts suggest that Bitcoin prices may drop down to $5000. The coin is currently trading at $6935.7 and is experiencing a loss of 5.52% against USD.
Some of the other crypto market crash speculations point to the US SEC's decision on the Bitcoin ETFs later this month. US SEC has rejected a number of Bitcoin ETF proposals this month and also recalled its Proshares ETF rejection. Also, some experts suggest that ShapeShift.io, the instant bitcoin exchange, which announced the introduction of a KYC process to trade cryptocurrencies must have cast a seller spell on the market.
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