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Bitcoin fell below $26,000, following several instances that took place recently. Following the announcement that China Evergrande, a massive Chinese real estate company, has applied for bankruptcy protection in a US court, BTC saw a significant decrease on Thursday.
The market is on edge as it waits for a ruling that may come as soon as tomorrow and resolve a legal case that Grayscale Investments has started against the U.S. Securities Exchange Commission, which is adding to the anxiety.
In the recently released minutes of the Federal Reserve’s meeting held on July 25-26, it was revealed that the focus of monetary authorities remains steadfastly on combatting inflation. This stance has led some to interpret that the possibility of further interest rate increases is not off the table. These minutes were made public as the S&P 500 experienced a decline of 0.8%, marking its second consecutive day of losses. Similarly, the Nasdaq 100 also faced a drop of 1.2%.
Drawing parallels to the crisis triggered by China’s Evergrande Group two years ago, there is growing concern over potential contagion effects stemming from the current debt crisis at Country Garden, China’s largest property developer. The uncertainty in the market is being compounded as fears of a fresh contagion spread, evoking memories of the previous crisis.
The year before, Grayscale filed a lawsuit against the SEC, when the agency rejected its request to convert its main fund, GBTC, into a spot bitcoin ETF. The outcome of this action could have a big impact on how the SEC evaluates several other spot Bitcoin funds that are now waiting for clearance. A successful outcome for Grayscale would be seen as a promising sign, which might up the market’s mood. An adverse decision, on the other hand, can portend upcoming regulatory barriers for the developing industry.
During the Friday morning trading session, Bitcoin (BTC) experienced a sharp decline of 10%, hitting a nine-week low at $25,649. This price level hasn’t been witnessed since June, around the time when the market took a hit due to a series of SEC lawsuits.
Coinglass reports a staggering sum of over $1 Billion in liquidations within the last 24 hours. Notably, the majority of these crypto liquidations, accounting for a remarkable 80%, pertained to long positions totaling $829 Million. This led to the unfortunate liquidation of 173,500 traders.
The total market capitalization has fallen to $1.09 Trillion, a 6.7% decline. Since the fall that was noticed in mid-June, this is the lowest point. A larger view demonstrates that the market is still restricted to its established range-bound channel, which has been the case since mid-March.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
