Bitcoin dipped below $40,000 briefly for the first time in almost two months amid mounting criticism from regulators. After that, global markets started moving upward again and the crypto with the biggest market cap followed suit, Bloomberg reported. Could it be time to buy Bitcoin before we witness another bull run? Bitcoin broke its three-day losing streak today, increasing to $42,132 after dropping to $39,625. Over the past 24 hours, many tokens were slightly lower, including Ether, Solana and Litecoin.
Antoni Trenchev, co-founder of crypto exchange Nexo commented:
“The price action demonstrates that Bitcoin isn’t immune to the selloff in risk-on assets across traditional markets. Bitcoin needs to retake the 200-day moving average at $46,000 and consolidate before a collective sigh can be released.”
Evergrande debt fears signal scaling back in asset purchases
Fears related to the debt crisis at China Evergrande Group and concerns over the Federal Reserve meeting outcome signal scaling back later this year, which is an obstacle for investors. Their concerned were not eased by China’s central bank’s liquidity injection into the financial system.
The Asian country’s “highly distressed” real estate companies face collapse due to Evergrande’s situation, alarmed Jenny Zeng, co-head of Asia fixed income at AllianceBernstein, in an interview with CNBC’s “Street Signs Asia”:
“In the offshore dollar market, there is a considerable large portion of developers (who) are implied to be highly distressed. These developers can’t survive much longer if the refinancing channel remains shut for a prolonged period.”
SEC chief harps on ‘gaps’ in digital token oversight
On Tuesday, U.S. Securities and Exchange Commission Chair Gary Gensler pointed out that in the past, commercial entities have not been successful in offering private forms of money. He repeated yet again that U.S. securities laws give the SEC a lot, if not supreme authority over digital tokens. He commented that Congress could help close certain “gaps” in digital token oversight, such as regulating crypto exchanges.
While many digital asset companies still have faith that SEC will begin to embrace cryptocurrencies, the regulator is taking steps in the opposite direction by issuing strong warnings to the industry. More specifically, they warn of an impending crisis on the scale of that in 2008. They find the industry is ‘echoing the toxic culture’ that existed before 2008.
On a more curious note, crypto-data network Pyth recently reported that Bitcoin had dropped to $5,402. Thereafter, they tweeted that engineers were investigating the cause of the error.