What is causing the sell off of bitcoin

what is causing the sell off of bitcoin

Privacy Center Cookie Policy. We compiled some of the data and this indeed seems to be true,» Lee wrote Thursday. But Tom Lee of Fundstrat may have just uncovered the reason behind recent weakness — or at least part of it.

Worries about a regulatory crackdown

Chainalysis is a blockchain company that provides reliable cryptocurrency-related data to helps government agencies, businesses, and financial institutions engage with the industry. The team lays the blame on the alleged PlusToken Ponzi. Chinese authorities chased the founders of the scheme to Vanuatu, where they were arrested and deported to China. Beijing investigators believe that the company operated a Ponzi scheme and scammed thousands of people. The money from new investors was used as payouts for those who came earlier, which is the most apparent feature of a traditional pyramid scheme. Now the experts claim that the founders of the pyramid started to cash out their loot.

Bitcoin Crashes 17%

what is causing the sell off of bitcoin

I bought my bitcoin through Coinbase, the most popular mainstream exchange for bitcoin and two other cryptcocurrencies, ether and litecoin. Such Coinbase crashes have occurred sporadically during heavy trading days since , at least. Another popular exchange, Kraken, has had similar outages. Those giant price gains are luring rabid investors hoping for a cut of the action, with soaring demand, in turn, pushing prices even higher. But if there are buyers there have to be sellers, and normal financial markets depend utterly on the ability to transact quickly, at known prices, no matter how volatile price swings may be. Buyers and sellers must be able to transact with the least possible interference, no matter how high or low the price goes. Yet the immature infrastructure supporting bitcoin is one reason it remains risky, with volatile price swings.

Don’t sell your coins for ones that are going up.

Bitcoin-rivals ethereum, Ripple’s XRP, bitcoin cash, litecoin, EOS and binance coin were also heavily sold off, wiping billions of dollars from the combined cryptocurrency market capitalization. The bitcoin price has been swinging wildly over recent months as traders and investors try to guess The cause of the sudden sell-off was not immediately clear, however, analysts have noted a drop in crypto market trading volume recently. Perhaps, a little too quiet,» Mati Greenspan, the founder of bitcoin and crypto research outlet Quantum Economics wrote in a note ahead of the bitcoin sell-off today, fausing the dominance of the world’s biggest stablecoin, tether, «seems to be waning.

Earlier this year, bitcoin and cryptocurrency price watchers warned that «dismal» bitcoin volumes could mean the market was headed for a perfect storm. In periods of low trading volume, crypto prices are more vulnerable to orf whales moving the market by placing massive buy or sell orders at a little above or below current market rates.

These can trigger trading algorithms that then send prices sharply higher or lower and can be a sign of market manipulation. PlusToken scammers are thought to have sold some 25, bitcoin, according to Chainalysis data, with a further 20, still to be dumped back onto the market.

I am a journalist with significant experience covering technology, finance, economics, and business around the world. As the founding editor of Verdict. I write about how bitcoin, crypto and blockchain can change the world.

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PlusToken to blame

Currency Converter. Read More. Marijuana Investing. Contact Us Privacy Terms. It’s been hard out there for a bitcoin trader.

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