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BTC Market Cap Dips Below $600 Billion after GBTC Doomsday Scenario Fails To Materialise

Bitcoin lost about 6% of its value in 48 hours — which is saying something considering that the top coin has effectively become a stablecoin of late. The question is: have derivatives short-sellers over-exposed themselves in this ever-tightening trading range?

Let’s dig in.

Grayscale Adds BNY Mellon as Service Provider, Eying ETF Approval

Grayscale has selected BNY Mellon — the oldest bank in the United States — to be the asset service provider for its bitcoin trust, which it will convert into an Exchange Traded Fund (ETF) soon.

Check out the full article here!

Technically speaking

BTC Market Cap Dips Below $600 billion

The world’s most valuable digital asset lost about 6% of its value in the last 48 hours, with its total market capitalisation dropping below $600 billion.

At $30,500, Bitcoin currently trades near its lowest level since June 26th, 2021

The overall market cap of digital currencies touched a low of $1.27 trillion on Monday after the latest sell-off in Bitcoin and Ethereum. ETH remained the worst-performing cryptocurrency among the top 5 in the last 48 hours.

Ethereum is now down by approximately 10% within the same time-frame.
The rule is simple — bitcoin leads and altcoins (including Ethereum) follow with higher volatility. As of this moment, there’s no reason to expect this rule to change.

The crowded trade

Bitcoin futures funding rates have been slammed in negative territory throughout this seemingly endless sideways range. This is to say that a good number of derivatives traders are confidently expecting prices to head lower.

Per the data above, BTC/USD has continued to range and coil up within lower bound area close to $30,000. Historically, there has rarely been a point where months of bearishness and negative funding rates were resolved to the downside. The same could be said for the inverse situation.

In fact, the crowd is often incorrect on short-term moves but correct over a long time horizon (hence the saying, ‘wisdom of the crowds’).

Could this be one such moment?

Short squeeze loading

As various traders and influencers have noted, BTC/USD closed the weekly below the 20-weekly Moving Average (not to be confused with the Exponential MA) — signalling a bearish trend on the weekly time-frame. However, the close was marginal and leaves room for interpretation. This renders the indicator less significant and pending further confirmation.

Should the range hold, then liquidity rests to the upside, with $33,500 being the first point of interest for the bulls. This ranging environment does not discount a potential liquidation wick (4-hour) to the 20-monthly EMA at $27,140. In my view, this scenario is less likely considering the funding rate situation. As mentioned in a previous newsletter, the GBTC unlock story was overhyped and failed to materialise in a doomsday scenario.

Can Bitcoin bulls pull it off, or will bear season continue for the next few weeks?

Time will tell.

Catch you later.

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Read More: Grayscale Adds BNY Mellon as Service Provider, Eying ETF Approval

https://chrisoncrypto.com/blog/f/grayscale-adds-bny-mellon-as-service-provider-eying-etf-approval
http://www.chrisoncrypto.com/

You can also support me in Bitcoin!
BTC address: 3EydsEYpjHn68axKnCUqBB7EbqcxrEjamr

Best regards,
Christopher Attard
Founder of Chris on Crypto
Contributor to www.cityam.com
Connect directly on: Telegram

Originally published at https://mailchi.mp.

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Christopher

Christopher

Journalist-turned crypto-writer & analyst; forging the narrative, stacking sats. Subscribe to the newsletter!

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