No End in Sight for Crypto Losses
There is no end in sight to crypto losses. Bitcoin flash crashed to $334 per coin yesterday, Litecoin is currently trading below $4 and Peercoin hit fresh lows. For bitcoin, the $550 support proved a crucial breaking point. The virtual currency has lost over 100 dollars in the past week alone.
The crash to $334 happened in a thin orderbook and was probably exacerbated by leveraged positions getting liquidated. The crypto is currently quoted at $442. Just like the fall down to £334, the subsequent rise was equally fierce, with BTC rallying back to $440 in less then 15 minutes. The crash on BTC-E comes just a day after rival exchange Bitfinex had a similar spike lower. Given the extent of the losses, we may see bitcoin consolidate before going for another leg down. Looking at both flash crashes, it seems like very few people are willing to keep their bids in the market, which doesn’t bode well for everyone’s favorite cryptocurrency.
Litecoin falls below $4, new low for Peercoin
Bitcoin’s silver had another bad week. Prices hit a low of $3.40 yesterday, a level not seen since July 2nd when prices spiked to $3 on low volume. Smaller altcoins Peercoin was not spared, PPC hit a new low of $0.565 yesterday.
No news catalyst
Despite the massive losses across the board, there was no news catalyst. The market seems to still be pricing in the effect of the proposed NY state regulations. Numerous entities including the Bitcoin Foundation called on the NYDFS to extent the comment period and engage the crypto community in a more direct manner. New York regulators have not responded to the Foundation’s request as of yet. According to most cryptocurrency experts, the proposed rules will create a steep barrier to entry and stifle growth in the bitcoin economy. Few days ago, Circle warned that if the NYDFS rules are adopted in their current form, the company will have no choice but to decline to service New York residents. The fear among crypto enthusiast is that the NY move will be followed by similar actions in other US states, impacting growth in the country.