Alexander Kuptsikevich
FxPro Financial Services Limited
Market picture
Bitcoin plunged more than 6% to $22.0K early this morning. The plunge into this area came as a market reaction to the potential bankruptcy of Silvergate. The news triggered a wave of stop orders on fears that the situation could cause a domino effect in the industry, as with FTX earlier in the day.
Technically, the dip has pushed the price below its 50-day moving average, which does not bode well for the short-term outlook, although this signal will only be reliable at the close of the day. The intraday picture is one of tidy buying after a brief dip. The overall moderately positive sentiment in the global markets supports the buy-the-dip mood.
A return above $22.8 an ounce before today's close could spark further buying. Closing near the lows would be an essential signal to spread fear throughout the crypto market, suggesting a further drawdown to $19.7K in the coming weeks.
News background
Shares in US holding company Silvergate Capital Corporation, which owns crypto bank Silvergate, plunged almost 49% on news of a delay in publishing its annual report to the SEC. The company said it needed "additional time" to complete its audit.
Silvergate Bank has announced that it may file for bankruptcy due to a massive sell-off and an inability to repay its debts. Coinbase, the largest US cryptocurrency exchange, has announced severing its financial relationship with Silvergate Bank.
According to Glassnode, retail bitcoin investors' purchases have outpaced coin issuance. Investors with balances up to 1 BTC ("shrimps") and between 1 and 10 BTC ("crabs") over the past year have bought 105% and 119%, respectively, more Bitcoins that were mined.
Ethereum developers have set March 14 as the date for the Shanghai upgrade on the Goerli test network. If the test network upgrade succeeds, the main network upgrade could occur in the second week of April.
Trade Responsibly. CFDs and Spread Betting are complex instruments and come with a high risk of losing money rapidly due to leverage. 77.37% of retail investor accounts lose money when trading CFDs and Spread Betting with this provider. The Analysts' opinions are for informational purposes only and should not be considered as a recommendation or trading advice.
Recommended Content
Editors’ Picks
Celebrity meme coins controversy continues amid Pump.fun revenue dominance
Pump.fun outperformed the Ethereum blockchain on Tuesday after raking in $1.99 million. Following this achievement, a meme coin based on actress Sydney Sweeney was the subject of controversy after its developers dumped their bags on investors.
PEPE's on-chain metrics indicate potential rally after weeks of silence
PEPE has struggled to see any significant price move after reaching an all-time high in May. Increased adoption rate and low MVRV ratio indicate a bullish run may be on the horizon. A single PEPE outflow from Binance worth $14.7 million gives credence to signs of bullish expectation.
Ethereum has failed to overcome key resistance despite bullish sentiment surrounding ETH ETF
Ethereum (ETH) is down more than 1.4% on Tuesday following another ETH sale from the Ethereum Foundation. Meanwhile, crypto exchange Gemini's recent report reveals that ETH ETF could see about $5 billion in net inflows within six months of launch.
Crypto community blasts Polkadot following report of treasury spending
Polkadot reports $87 million of treasury spending during H1. Crypto community members expressed harsh feelings toward the DOT team's high spending. DOT is up more than 2% in the past 24 hours but risks correction following the report.
Bitcoin: BTC price correction could end in July, according to seasonal data
Bitcoin (BTC) price appears poised for a decline this week, influenced by slight outflows in US spot ETFs, selling activity among BTC miners, and a combined transfer of 4,690.28 BTC to centralized exchanges by the US and German governments.