What did just happen? Within a snap, the crypto markets just plunged to the lowest point breaking a multi-month stability. It was not just the Bitcoin but nearly all leading currencies were deep in the red. While the actual reason is still unknown the prominent one seems to be the Bitcoin hard fork event that is scheduled to take place today.
Bitcoin and All Cryptos Plunge to New Multi-Month Lows as Crypto Street Sees Bloodbath
A few hours of ago (from the time of reporting) all cryptocurrencies including the Bitcoin were in a stable mood, that they had been carrying for quite some months now. But all this steady and stable environment turned into terror as there was a sudden dump in the market and that too across the street which wiped of over 10 billion dollars from the street in 1 hour. The bitcoin deep dived to near 5600 levels marking a multi-month low. Ethereum, XRP, BCH and practically every other coin saw a drop of around 10% taking them to multi-month lows breaking all logical support levels. Leave aside others, even Tether, which is a stable coin, fell around 3 % clearly showing the sentiment on the street.
Why did this happen and what were the reasons behind this are still unknown, but most the street believes it is because of the arrival of Bitcoin Cash Fork date, 15th of November. While we are still some time away from the Fork to actually happen, the drama on the street and the divided Bitcoin Cash community has sent this shock waves creating a situation of panic and uncertainty.
No Fork Support for BCH
Bitcoin Cash (BCH), which is undergoing its controversial hard fork event today, is currently trading at negative of around 17% at its current price of $429.20, virtually erasing all its previous gains that resulted from hype surrounding the hard fork event BCH, on back of this forking news, had rose from lows of $415 in late October to highs of $635 in early-November, before crashing to its current price. The high selling volume just before the hard fork event is a sign that investors are not interested in the crypto units resulting from a hard fork event.
Another reason associated with this fall is that its expiry day today at CBOE. It is believed the recent spike in crypto markets had forced a lot of traders to take long positions in the market and a lot of them seem to wind those up as these spikes did not sustain on higher levels.
While the actual reason is still unknown, this fall is definitely not a good sign as this creates a doubtful situation for a Christmas rally in cryptos
What do you think is the main reason for this dump? Do let us know your views on the same
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Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Follow him on Twitter at @KoinKing1 or connect with me on linkedin.