In the last two days, the evaluation of the crypto-currency market to 201 billion US dollars (172,7 billion euros). Bitcoin has lost 13 percent and the total market capitalization approached its annual low of 192 billion US dollars (165 billion euros).
Since the 6. September, as the price of Bitcoin fell within an hour to more than 10 percent, has fallen to the crypto currency market continuously. The tokens recorded more significant losses than previously in April and June and lost 10 to 30 percent against Bitcoin.
source: coin360.io
Cointelegraph interviewed the senior market analysts of think markets and former traders of the Bank of America Naeem Aslam, eToro’s Senior market analyst, Mati Greenspan, and the known technical crypto currency analysts Uzi and spoke with them about the recent decline of Bitcoin and the Rest of the cryptocurrency market.
decline of 40 billion US dollars: One of the largest declines within a day of the last year
At the 6. September, the cryptocurrency market have lost in less than 24 hours, almost 40 billion US Dollar (34, 4 billion Euro) and thus recorded the strongest declines of the last three years.
source: CoinMarketCap.com
in mid-August, the crypto-currency market fell to its low for the year of 192 billion US dollars (165 billion euros), but it lasted seven days (from the 7. to 14. August), to a so strong decrease has been observed.
Before Wednesday, in the course of August, showed Bitcoin to its highest level of stability since June of 2017, as found by researchers from Diar noted. Of 8. to 26. August remained the Bitcoin price in the range of $ 6,000 (5.156 Euro) is relatively stable before an overdue corrective rally above the Resistance Level of 7,000 US dollars (6.016 Euro).
source: CoinMarketCap.com
period of four days, But led to a headlong rush rally of 7,000 US dollars (6.016 Euro) total of 7,400 US dollars (6.360 Euro) within a period of time and that selling pressure built up and the bears on the crypto currency market is the upper hand got, making Bitcoin fell significantly.
at the end of August, said ShapeShift CEO Erik Voorhees, the Baärenmarkt was not yet over, but the low price range of the most important crypto-currencies would be a good opportunity for new investors to enter the market.
The daily Chart of Bitcoin shows four similar movements since February. In the last six months, Bitcoin has fallen risen four times to $ 10,000 (8.594 euros) to 6,000 US dollars (5.156 Euro), has recovered to US $ 10,000 (8.594 Euro) and the Resistance at 6,000 US dollars (5.156 Euro) were tested.
In February, Bitcoin rose to 11,000 US-Dollar (9.454 Euro), but fell back to $ 6,000 (5.156 Euro). In April, Bitcoin rose to $ 10,000 (8.594 Euro), and fell to 6,000 US dollars (5.156 Euro). In July, Bitcoin rose to 8,500 US to test Dollar (7.305 Euro), only a month later, the Resistance Level at 6,000 US dollars (5.156 Euro). In September, the same pattern occurs every peak above eventually sinks to 6,000 US dollars (5.156 Euro).
image caption: a one-Day Bitcoin price chart of Cryptowat.ch
Should recover Bitcoin from the support level of 6,000 US dollars (5.156 Euro), could bring the next short-term rally of Bitcoin to US $ 7,000 (6.016 Euro). After that, he could fall back to $ 6,000 (5.156 Euro). But if the dominant can progress to the end of crypto currency to the bottom of the valley in the area of $ 6,000 (5.156 Euro) successfully, could result in the possibility of a proper medium-term rally with renewed vigor.
factors contributing to the decline in
In an interview with Cointelegraph, the Executive market analyst of think markets Naeem Aslam said that speculators have added to the downward trend of Bitcoin, unnecessarily, by oversold Bitcoin on the global currency market.
Aslam stressed that the not have down changed the trend of Bitcoin in December 2017, as the crypto-currency market reached a rating of 900 billion US dollars (773,5 billion Euro) and a rapid decline was recorded:
“speculators are rotated through and try as much as possible from this trade squeeze. Bitcoin has not changed since December of last year, so why the panic?”
Aslam added that it was difficult to mention specific factors that have led to the price of Bitcoin has fallen significantly in recent months.
analysts and investors in the crypto currency market and the broader financial market often try to make correlations between the price movements of the Cryptocurrency and find the developments in the field of cryptocurrency and Blockchain.
there is A correlation, however, is not synonymous with causality. And just because an event occurs at a certain time, in which the crypto-currency rates fall or rise, does not necessarily mean that the event has triggered a large movement on the crypto currency market.
The TABB Group, an international research company, reported in July that the Over-the-Counter (OTC) Bitcoin is at least twice or three times as large as the crypto currency market.
Under the assumption that the OTC market is, in fact, two to three times larger than the stock market for crypto, should have currencies of the developments in the crypto currency area, at least in the short term – only a minimal impact on the price movements of Crypto, because of the stock market from the larger OTC market will depend.
In the Report it was stated that the on Wednesday commenced correction of Bitcoin is mainly due to the delay in the decision of Goldman Sachs, a Bitcoin Trading Desk.
It is very say far-fetched, that the decision of a large investment Bank, to switch from one offer Bitcoin trading services for its clients that consist of institutions and large companies, maybe attractive in crypto currency, custodial services, had the Bitcoin rate back within the hour.
It is more likely that the has resulted in since December of 2017, continuing selling pressure on Bitcoin and other major Cryptocurrencies instability and volatility in the market, which led to a decline in the market valuation.
Since the volume of Bitcoin saving in comparison to traditional assets, and Value as Gold continues to be relatively low, it is easier to have an Domino effect on the leading crypto-currency exchanges to trigger.
Goldman Sachs delay of a Bitcoin Trading Desk will not be relevant
At the 6. September, reported Cointelegraph that Goldman Sachs has postponed the formal launch of its Bitcoin trading platform. This should satisfy an increasing demand of individual traders and private investors.
Goldman Sachs spokesman Michael DuVally told Reuters that the Bank could not reach consensus on the Roadmap of your enterprise with respect to the digital assets. As a reason for different regulatory problems were cited, on the markets of the United States.
hours after the Declaration of DuVally was published, Martin Chavez, has denied financial officer of Goldman Sachs, personally wegbewege that the Institution of the creation of a Bitcoin-trading venue, and that reports were about “false news”.
Aslam said that it was premature, the rings of the market this week on the delay in the introduction of the Bitcoin Trading Desk by Goldman Sachs, as the Bank does not have discontinued operations, but instead have moved to focus on a more immediate Initiative, namely the crypto-currency deposits:
“Goldman has moved the process, you eventually have a lot of money and expertise invested in this area. Investors need to know that banks are very common, not to delay the IPO process when market conditions are favorable. And here we are talking about, to start something completely New. Goldman is active in many areas when it comes to Bitcoin, so one should stop and ponder on the course.”
Currently, the crypto-currency market has a wide range of regulated exchanges, such as Coinbase, Gemini, and UPbit, which can be used by retailers for investing in the crypto currency market. It deposits and solutions, which can be the barrier between crypto-currencies and institutions break through lack, however, is trusted.
One could argue that Goldman Sachs is working on a more pressing issue that must be addressed, in order to convince the wider financial market and the governments of crypto-currencies as a new emerging asset class to recognize.
The announcement of Goldman Sachs have contributed to the decline in the market, however, as the technical crypto-currency analyst Uzi told Cointelegraph that it is hard to believe that Goldman Sachs was not the only cause for the correction. Bitcoin stood at about 7,400 in U.S. dollars (6.360 Euro) a Resistance to. This value is at the same time state of the maximum that it reached last week, before he slipped to the bottom:
“I think that the message from Goldman Sachs on the Back of the plans for your crypto-Trading-Desk definitely helped with the Bitcoin drop in trigger. We were also with 7400 US-Dollar (Euro) a strong Resistance, but it is no big secret that a huge amount of BTC Short positions were opened in the days prior to this decline on Bitfinex. 10.000 BTC to Short positions, I believe – follow the money, as they say.”
the Same bear trend since February
Mati Greenspan, Senior Analyst at eToro, one of the largest Multi-asset trading platforms in the global financial sector with eight million active users, the evaluation of Aslam and said that the crypto-currency market in the last few months, in a Trend similar to that was and was not able, with solid volume and momentum from the Resistance Level at US $ 8,000 (6.875 Euro) break out:
“has increased The volatility in the crypto markets in the last few days, but this market is still pretty normal. What affects the Bitcoin price, so he moved in the last few months in a fairly stable range of between US $ 5,000 (4.297 Euro) and US $ 8,000 (6.875 Euro) and nothing has changed.”
Greenspan added that the volatility is due to the market on lack of demand from traders in the crypto-currency sector and not to specific events, named by analysts as the main cause for the recent correction.
“there are Several possible reasons for the decline in could be in addition to a couple of bad rumors circulating in the press, including a stronger Dollar and a weakness in the technology stocks. But ultimately it is just more supply and less demand in the short-term trading.”
Technical Analyst: Bitcoin market is illiquid and fake quantities
Bitcoin is not considered to be sufficiently liquid market, especially when you consider that the stock market for every individual Investor and as a retailer on the world market. The provider of crypto-currency market data to estimate the daily volume of Bitcoin to about 5 billion US dollars (4.3 billion euros), but studies have shown that most of the major crypto-currency exchanges, the swelling in volume through Wash Trading.
Alex Kruger, an Economist and crypto-currency trader, said earlier in the week that Bithumb, South Korea’s second largest crypto-currency exchange after cocoa, a subsidiary of UPbit, said that since the 25. August was created over 250 million US dollars (214.8 million euros) of counterfeit volumes.
He explained that a group of traders has used the 120% refund of the trade fee of Bithumb, which can generate 90,000 US dollars (77.352 Euro) with a daily trading volume of 250 million US dollars (214.8 million euros).
“It is currently being traded 250 million US dollars (214.8 million euros) to fake volume on the Korean crypto exchange Bithumb, every day at 11 am Korean time, since the 25. August. Bithumb a 120% refund of the trade offers fees as Airdrop. The trading fees are 0.15%. In order to receive the full discount of 1 billion KRW, must be a Wash-Trader so 278 billion KRW. The 250 million US dollars (214.8 million Euro) on a daily basis fake volume. Notice how a total of 31,000 Bitcoins at 11 a.m. to be traded.”
Directly or indirectly, of Bithumb method has promoted the Wash-Trading, which increases the daily trading volume of the cryptocurrency stock exchange. The end result is a daily net income of 90,000 dollars (euros) for a group of dealers and a significant increase in the daily trading volume of Bithumb.
While the method is, however, a Win-Win Situation for both partys leads, negative impact on the global cryptocurrency market, as it reduces the authenticity of the volume of international trade of crypto-currencies.
Uzi explained that liquidity and fake volumes have to deal with two problems, the crypto-currency exchanges urgently, in order to ensure that investors are protected on the market, and governments need to recognise the sector as a legitimate branch:
“the solution to The liquidity problem is a Problem that must be solved. And the Problem of fake volumes is something that needs to be addressed on a larger scale, because there are definitely questionable volumes on major stock exchanges.”
Uzi also stated that the Bitcoin market is still generally illiquid, as there is in this sector no activities of institutions and large hedge funds. He explained that the market was still so far to satisfy the demand of institutional investors. Most of the Short – or Long contracts around Bitcoin, which will be submitted via the US Futures market or a crypto-currency exchanges are carried out by individual investors.
“I’ve always had the feeling that the market for Bitcoin is still illiquid, and particularly if you look at the Altcoin market. I don’t think that a professional Institute at the time would open up a Short Position in Bitcoin, if only because of the sheer volatility and the momentum that it had when you Test a ordinary Resistance, as well as because of the massive opening of Short positions, which was the most striking. That would be a terrible risk management.”
What’s next with the market variables
As Cointelegraph happens – plus the Coinbase-ETF-7. September reported, is the world’s largest asset Manager, BlackRock, of the 6,317 Bio. US Dollar (5,42 Bio. Euro), supervision of assets, and to speak of Coinbase, the largest exchange and the largest Brokerage in the crypto currency sector, through the development of a crypto currency-based exchange-trade Fund (ETF), in order to strengthen the market activities and to satisfy the growing demand of the Institute to crypto-currencies.
The entry of VanEck and the Chicago Board Options Exchange (CBOE) has already increased the probability that the first Bitcoin ETF is approved by the U.S. securities and exchange Commission (SEC). The involvement of BlackRock will lead to more competition in the Bitcoin ETF under-regulated U.S. financial institutions. This, in turn, can lead to more competitors submit with the SEC amendments to the liquidity of the dominant crypto-currency.
variables such as Bakkt, the Coinbase-BlackRock-ETF and positive regulatory developments in Japan and South Korea could, in the short term, contribute to the recovery of the crypto-currency, which was not in previous corrections in the years 2012, 2014 and 2016.
experts are generally agreed that the correction of the crypto currency market on 6. September was caused by an increasing selling pressure and the escalation of various developments, and not by a single event, such as the announcement of the Goldman-Sachs-Bitcoin-Trading Desk, to have had a huge impact on a global market.
