BTC - Just like that, a week of gains gone in a matter of hours
Prices tend to take the stairs up and the elevator on the way down.
Crypto investors just got a nice reminder of that today.
Bitcoin is currently barely clinging to $6,900 after trading around $7,300-$7,400 for much of the past few days.
In fact, bitcoin hadn't seen $6,900 since August 30th.
Almost a week of gains wiped out in a matter of hours.
(Source: https://coingape.com/bitcoin-price-analysis-btc-usd-nosedives-below-key-support/)
What was the culprit?
Unlike times in the past when it wasn't entirely clear what sparked the round of selling, it was pretty clear what caused the drop today.
Goldman Sachs put out a note saying they were shelving their plans to launch a crypto trading desk any time soon due to regulatory uncertainty.
More about it can be found here:
As you might have guessed, the market didn't take that news positively.
Bitcoin and the rest of the crypto space began immediately selling off, with altcoins bearing the brunt of the pain.
(Source: https://coinmarketcap.com/)
As I type, just about every altcoin in the top 50 is down anywhere from 10%-20%.
Ouch!
Bitcoin is down roughly 6%.
Not as bad as it sounds?
Clearly the market is back in shoot first ask questions later mode as the announcement from Goldman wasn't nearly as bad as I just made it sound.
They said they were shelving plans to launch a crypto trading desk for now, due to regulatory uncertainty.
Did you catch that "for now" part?
That means that when there is more clarity they will likely come right back to it.
The other thing is that Goldman said instead of launching a crypto trading desk, it was going to focus on building out custody and storage solutions for institutional investors.
Something that could be argued might even be slightly more bullish then a crypto trading desk would have been.
It opens yet another door for institutional money to enter the space.
Yet markets are down YUGE across the board.
Does that make sense?
Not really, but many things in crypto don't make much sense.
However, there was one interesting observation on my part...
I pointed out a few days ago how short sellers were continuing to pile into bitcoin even though it was going up. Something we haven't seen much of lately.
https://steemit.com/bitcoin/@jrcornel/bitcoin-margin-short-positions-are-piling-up
In the past, short positions had tended to pile up near bottoms.
I'm not pointing any fingers here but if I had to guess I would guess those short sellers knew this Goldman news was coming out and they were either traders at Goldman taking up those positions, or friends of Goldman looking to lock in a guaranteed 5%-10% profit when the news broke.
Things that make you go hmm...
If the SEC wants to investigate bitcoin price manipulation, that might be a good place to start.
Stay informed my friends.
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Follow me: @jrcornel
I really dislike Goldman Sachs. These guys are huge market manipulators in the regular stock market and now they are manipulating crypto as well.
I don't understand why people fall for their nonsense. Whenever any stock is doing well, they nay say it one one or another, then it takes a big dump, after which I imagine they buy a huge stake in it. Then of course it recovers.
I really wish something could be done about these people.
I share your same views. By the SEC not allowing ETFs which would bring in many more retail investors as well as other funds that are mostly long only funds they are leaving bitcoin to be traded by the sharks of wall street. The ones with the technical know how to trade it and to short it. The SEC thinks they are protecting investors but they really aren't at all currently.
That is pretty much how I feel about it. I'm glad to finally hear someone else say it.
Thanks @nuthman. I certainly don't want to be negative about anyone, but Goldman Sachs in my opinion is the 2nd most despicable entity in the financial world, dwarfed only by Andrew Left from Citron, who teeters very close to criminal activity in my opinion.
Yeah, the whole Left thing is tricky. He calls himself an Activist Short Seller. So there's nothing really illegal about that, but it gets a bit weird when someone has that much influence, puts in a short sell order and then blogs his investigation results on that company causing the stock price to crash.
So there's nothing technically illegal about it, even though he profits from losses that he artificially created in the same way that GS does.
globman sucks are sub-human zionist scum...
Crypto traders should not be so foolish... But nothing can be done about that..
I don't believe this was Goldman Sachs, it seems more likely it was a 3rd party that knew the news was coming and took took advantage to manipulate the price. The news by itself should not have caused this size of price movement.
It's unfortunate that there is so much manipulation and scams going on in crypto that is slowing down adoptation. Hopefully this will end soon. Thanks.
As long as there is money to be made I doubt they end any time soon. The US stock market is still ripe with fraud and manipulation no matter how long it has been around and how many rules and regulations they have.
It is definitely possible that someone with a lot of money to gain put in some shorts right before the news broke. It is a little ridiculous how immature the markets still are nearly a decade after BTC was created. Luckily the adoption is speeding up as technology advances :)
I took the opportunity today to scoop up 1 ETH for just over $250 with fees and over 110 STEEM at around $0.87 each. Slow and steady accumulation just in case we continue to fall.
Probably some pretty good buys right there. The fact that margin shorts were continuing to climb the last few days could be telling, or it could be not related at all and they just got lucky. Either way, there is a little smoke, and where there is smoke...
That's the way to do it. If you believe in crypto you shouldn't be scared off by 10% dips.
I bought 4 LTC and 0.08 BTC today, and Ive got some buy orders for steem that I just missed.
Did they end up hitting? I saw steem sitting at $.80 last night.
Same here... loaded up on some Steem!
just like ordinary day in crypto, manipulation and bad news
It has been the norm for 9 months now.
I'm sure it will continue as well; we just have to ride the wave if we want to reap the benefits!
I checked my Blockfolio account this morning and was like 😳... it’s all good though, I’m in crypto for the long haul 😀
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If you are in for the longer term the price drops on bitcoin don't matter much. However, some of these other coins may not be around for the long term so gotta be careful just buying and holding those.
That’s the truth, 95% of alts will not be around in a few years 😀
Just buy more! You can't afford NOT to!
Just loaded up on Steem at bargain prices - See ya at the top!
Good time to increase your stake on steemit.com that is for sure. Much cheaper than it has been in over a year and a half.
Cheers.
Great idea! If I could afford it, I'd buy a truckload.
😩💰😩💰😩
I look at what it was this time last year and I don't see a problem. But I also didn't put any new money in after $3k. I took some of the profits in December and just have been holding to see what it does. But unless it looks like it is gonna crash to pre 2017 summer levels I am feeling good about my positions.
Yea, last year at this time, bitcoin was trading for around $4,500. It is still up year over year, but not by much and that wont' be able to be said for much longer. The bear market is almost 9 months in length at this point.
Thanks for the info man! Yall check my art if you have the chance. @arainetjay on IG
@jrcornel very well explanation what is the cause behind it, that's why i'm very much interested to your post, thanks for shearing your knowledge. keep up great work , good bless you.