On the morning of November 25, the Bitcoin price recorded a sharp decline to the $ 6,600 area, officially setting a new bottom for the last six months.
Just last Sunday, the world’s no. 1 cryptocurrency is still stable at around $ 8,500, at least brighter than the reality of the market. So what is the reason behind the adjustment to more than 22% of the value in just this week?
1. The market has shaken after Bitcoin price dropped to $ 7000
Every time Bitcoin prices go down; investors seem to be shaken. Besides, they are concerned about the losses leading to poor judgment, sell-offs, etc. As a result, the situation gets worse.
However, these shy investors are not a significant concern for long-term HODLers. Or for those who want to increase their Bitcoin investment. After all, the market always needs some fools to buy high and sell low so that they can do the opposite.
2. Politics and Bitcoin are not closely related
Some people think the US Federal Reserve’s continued policy of quantitive easing was supposed to be bullish for Bitcoin. However, this is not entirely true. Unfortunately, Bitcoin doesn’t respond to macro variables.
Again, pointed out by Krüger:
Added liquidity can only help price, but $BTC doesn’t respond to macro variables.
It is such an illiquid/fragmented market that in the absence of mass influx of new buyers, actions of a few determine direction. Micro, not macro.
Only narrative still standing is the halving/s2f.
— Alex Krüger (@krugermacro) November 24, 2019
3. Bitcoin whales manipulate the Bitcoin price
Bitcoin has long been a highly volatile and highly volatile trading market. Therefore, the possibility that Bitcoin whales are putting downward pressure to reserve BTC before the Bitcoin Halving is coming up.
The Bitcoin Halving will lead to a significant (and perhaps permanent) price increase. So, you can hodl Bitcoin as much as possible before then.
4. BitMEX dumping on the market
Liquidated positions on BitMEX lead to huge fees collected. And BitMEX has no qualms about dumping straight back onto the market.
According to the analyst, Alex Krüger, BitMEX is currently raking in fees as much as 7% of the total combined miner issuance. And a large percentage of Bitcoin sold right back into the market.
So those taking highly leveraged bets on bitcoin through BitMEX are not only putting themselves in a position to very likely get Rekt. They are also potentially damaging to the cryptocurrency market. Sadly, a lack of volume on BitMEX isn’t necessarily any better.
5. China issued a law to “regulate” exchanges, “FUD” Binance
On the evening of November 21, the global cryptocurrency community was shocked by the information that the Binance exchange office in Shanghai (China) was “raided” by police. Although Binance CEO Changpeng Zhao later reassured that Binance did not have an office in Shanghai and criticized the news site that spread the rumor, even calling it FUD, but could not contain the decline of Bitcoin.
No police, no raid, no office. Hope you didn’t pay to read that FUD block. pic.twitter.com/W2msvY2hSA
— CZ Binance (@cz_binance) November 22, 2019
These ideas are just ordinary “fake news,” but by the afternoon of November 22, the Shanghai branch of the People’s Bank of China (PBoC) – the central bank of the country of billions of people – suddenly announced. The newspaper said it would “rectify” activities related to cryptocurrencies.
Read more:
- Bitcoin Still Outperform 85% Than The Top 50, Despite Falling Prices
- Bitcoin Is Reflecting The Fractal Fractal Of 2014 Price, Likely Bottom At $ 6000