Three Reasons Why the Action of The CFTC Against BitMEX Will Not Bring The Price of Bitcoin BTC Down.
US Commodity and the Futures Trading Commission (CFTC) have accused BitMEX of money laundering and illegal exchange of derivatives with encryption and Bitcoin prices (BTC) When the US authorities announced the arrest of one of the co-owners of BitMEX, Samuel Reed, it led to an immediate market reaction.
Until March 2020, until the elimination of Black Thursday by $ 1 billion led to a fall in the MTC rate below $ 3750. BitMEX remained the leading Bitcoin (BTC) futures exchange. Against this backdrop, BitMEX rivals such as Binance Futures and ByBit have significantly increased their share of the cryptocurrency market.
Contrary to expectations that it will take time to bring charges against BitMEX management. Samuel Reed's arrest was unexpected and shocking. As a result, the price of BTC fell by 4.11% from $ 10,883 to $ 10,437. Despite this, there are several factors that can return lost positions to Bitcoin in the short term. Driving factors include the relatively short duration of this correction. Consider Bitcoin's (BTC) response to regulatory threats and the current $ 10,500 support level. In the short term, Bitcoin (BTC) experienced a sharp decline. The Bitcoin price has dropped more than 4% in a short period, which is very unusual for this cryptocurrency. Usually, such an intensity of the fall in BTC leads to a series of liquidations. Since a large number of transactions in the futures market have a high percentage of leverage (leverage), this entails the elimination of long-term contracts, as well as an even greater fall in the rate. After these events, the volume of open and futures contracts dropped significantly. Reducing the activity of using leverage reduces the likelihood of a large-scale correction. The history of price falls caused by regulation shows what is the key to market recovery. Over the years, the cryptocurrency market has experienced many regulatory measures taken by governments of different countries. But as Bitcoin researcher Vijay Boyapati said, BTC has coped and strengthened from all the negative regulatory measures. While the allegations against BitMEX may have a short-term bearish effect, the situation will recover in the long term.
According to Boyapati: The bitcoin market has always reacted negatively to various problems or decisions by governments. Historically, this has always provided a great opportunity to buy bitcoins. The Department of Justice's actions against BitMEX also did nothing special, with $ 10,500 remaining a key buffer position. The $ 10,500 level was strong support for most of August and September. Bitcoin sometimes briefly dipped below this level, but recovered quickly. This shows that traders are confident that the price of Bitcoin will only rise in the future. Currently, traders recommend staying careful in the short-term trend of Bitcoin fluctuations, but in the medium to long term, not to worry or panic.
Cryptocurrency trader Kantering Clarke wrote: “I think that in the short term this presents tremendous opportunities for two-way trading. Ultimately, time will fly by and short-term shocks will not affect long-term price movements. The duration of this price swing is very short and the market will quickly respond with growth.
Michael van de Poppe, a resident trader at the Amsterdam Stock Exchange, also expressed a similar opinion. He said, “Don't you know BitMEX? Yes I know. I also know about the hacking of cryptocurrency exchanges that caused the price of bitcoin to fall. I trade on various technical market indicators. However, due to domestic news, price fluctuations often occur before the news is released and 99% of the news is outdated.
As of this writing, the Bitcoin price continues to trade within a symmetrical triangle and maintains the $ 10,500 level. For traders who are concerned about support resistance levels, the price of $ 10,200 is important. If the price falls below this support level, many traders still hope to maintain the support level between $ 10,000 and $ 9800, because buyers were happy to buy Bitcoin at this low level. during September.