Bitcoin had been trading at around $23,500 for much of the previous week winding into February
Bitcoin edged up to top $22,500 early Monday before pulling back just below that level in the afternoon.
The biggest crypto currency in terms of market value was recently trading higher than $22,400 and squarely in the narrow range it is occupied since Thursday when traders liquidated around $78 million in long positions on concerns over Silvergate Capital. Bitcoin (BTC) had been trading at around $23,500 for much of the past week winding into February.
It appears the more Wall Street positions itself for a major sell-off with risky assets, markets refuse to break, according to Edward Moya, senior market analyst at foreign exchange market maker Oanda.
Jeff Dorman, CIO at digital asset investment firm Arca, wrote in a newsletter Monday that the crypto market’s stability in recent days indicated the fall in price late Thursday ‘may have been just a single seller (or small group of sellers) rather than a market-wide panic.’
ETH, the second-biggest crypto currency, was recently at $1,569, up 0.4 per cent from Sunday, same time. The CoinDesk Market Index was flat for the day.
BTC and ETH have dipped nearly 3.1 per cent and 2.5 per cent, respectively, during the past seven days. A report from crypto data firm Kaiko highlighted that the funding rates of these two assets turned negative in the past week, indicating bearish market sentiment.
California-based Silvergate said in a filing during the past week that ​​the impact of recent events – especially the collapse of FTX exchange and ensuing regulatory actions – raised questions about the bank’s capability to ‘continue as a going concern.’ In the subsequent days, industry fallout has broadened with a number of businesses including Coinbase and Paxos cutting ties with the bank. Shares of Silvergate (SI) ended down 6.2 per cent Monday.
Silvergate made the mistake of merging traditional banking with a centralized crypto currency exchange model, Sheraz Ahmed, managing partner at blockchain consultancy Storm Partners, told CoinDesk. Ahmed sees an increasing likelihood of the crypto market contracting as the industry endures fresh liquidity crises.
The first crypto bull market to attract institutional involvement closed not too long ago, and many still needed to get ready for a sharp market drop, he said. Unfortunately, those that did not are paying the price.
On Friday, Silvergate Capital closed its Silvergate Exchange Network (SEN), the instant payment service that permitted real-time crypto-to-fiat transfers between investors and exchanges. But in an interview with CoinDesk TV’s ‘First Mover’ Monday, Hany Rashwan, Chief Executive Officer of crypto investment product firm 21.co, said the shutdown of the SEN platform did not necessarily have ‘a material impact’ on BTC’s price.
