Bitcoin is starting to lose its grip on $60,000
Bitcoin was struggling to cling to the key psychological level of $60,000 this evening, following signs that traders were reining in some of the excessive speculation which had sent the cryptocurrency soaring.
Central bank officials say changing trends and developments on the regulatory and monetary side could also halt the gains for digital assets, while US lawmakers believe legislation is needed to regulate cryptocurrencies before they start to pose a danger to the financial system.
The Fear & Greed Index – published each morning on Crypto AM Daily – is currently registering at ‘54’ which places it into unfamiliar territory known as the ‘neutral’ stage.
According to Freddie Evans – a sales trader at London-based digital asset broker GlobalBlock – historical trading data tells us this suggests that we are in a stagnant stage for the time being.
“On-chain data shows that Ethereum exchange outflows reached their all-time highs on Wednesday as ETH lost almost 15 per cent of its value, dipping as low as $4,000,” he said.
“This shows that the majority of Ethereum holders retained their confidence in the token and have been buying the dip. In 24 hours QRDO was up 28 per cent, ALGO was up 12 per cent and Metaverse tokens Decentraland and The Sandbox were up nine per cent and 18 per cent respectively.”
However, any green signs on smaller coins may indicate the embryonic rumblings of what might yet play out to be an altcoin season.
A series of hefty liquidations this afternoon dragged Bitcoin across some painfully thin ice, with random wicks jabbing their tails below $56,000 – a clear indication that a volatile shakedown could potentially be on the cards.
Despite the sense of fear creeping over the markets this week, there are reasons to be positive on the horizon.
For instance, the president of Peru’s central bank has indicated that the country will be joining forces with India, Singapore, and Hong Kong to develop its own central bank digital currency (CBDC). Peru finance chiefs will partner with the central banks of countries it deems to be more advanced in their development of CBDCs.
Meanwhile, just two weeks after unveiling Hollywood superstar Matt Damon as its poster boy, Crypto.com announced it had signed a $700 million, 20-year deal to rename the iconic Los Angeles Staples Center the ‘Crypto.com Arena’.