On Thursday, October 1, the U.S. CFTC filed a complaint against crypto exchange BitMEX accusing it of illegal crypto derivative trading and money laundering. Hours later, BitMEX responded denying all charges and assuring investors that their funds are absolutely safe with the exchange. However, the damage was already done!
As per the fresh report by Glassnode, a total of 32,000 Bitcoins (BTC) have been withdrawn from BitMEX. The withdrawal happened just a few hours back in three large batches. It means that investors pulled out nearly 19% of the total BTC held by the exchange. This has also been the largest hourly BTC outflow from the exchange, a whopping $320 million.
Update: Another batch of ~6k BTC was withdrawn from #BitMEX in the past hour.
— glassnode (@glassnode) October 2, 2020
Soon after the CFTC announcement on Thursday morning, seemed to be under selling pressure. At press time, Bitcoin is down 4.15% trading at $10,443 with a market cap of $193 billion. Bitcoin (BTC) lost around more than $400 over the last 24 hours but still maintains above its crucial support of $10,000.
Overall Crypto Market Enters Major Correction
At press time, the overall crypto market looks in deep red. Apart from Bitcoin, almost all other top ten cryptocurrencies have corrected between 5-10%. The latest crypto market correction comes as stock markets come under heavy pressure after U.S. President Donald Trump tests positive for COVID-19.
The Dow Jones Futures (DJIA F) entered a sharp correction soon as the news broke out a few hours back. This is yet another proof that the crypto market moves in tandem with the stock markets. While Bitcoin entered a deep correction, the gold price shot soon after the news further widening the gap between Bitcoin and Gold correlation. The below chart shows that the gold price jumped to a high of $1916/oz in the last six hours. However, it failed to break the $200 ceiling. At press time, Gold is trading at a price of $1908/oz.
Interestingly, popular crypto analyst Willy Woo called the CFTC charges as a necessary cleanup to make way for Bitcoin ETF.
CFTC is wrecking BitMEX for wrecking Bitcoiners. It's a necessary clean up step before an ETF can be approved. This is one of those "the herd is coming" events.
— Willy Woo (@woonomic) October 2, 2020