Bitcoin (BTC), Ether (ETH), and crypto-linked stocks like MicroStrategy are seeing a sharp drop after news broke of FTX announcing the filing of Chapter 11 bankruptcy and the resignation of Sam Bankman-Fried as CEO.
Cryptocurrency-linked stocks plummet
MicroStrategy (MSTR), led by outspoken Bitcoin advocate Michael Saylor, is down 32.57% on Nov 11 in a 5-day period. MicroStrategy owns around 130,000 bitcoins and therefore its share price is strongly correlated to the BTC/USD pair. Meanwhile, the tech-heavy NASDAQ has gained 0.79%.
Mining stocks have suffered losses today, with the Hashrate Index of cryptocurrency mining stocks showing a 0.14% loss as of noon on Nov. 11. The market performance of the major miners is much lower. Marathon (MARA) is down 4.95%, Riot (RIOT) is down 5.74% and Hive (HIVE) is down 16.08%.
Meanwhile, the price of ETH saw a 22% decline this past week despite Ether going deflationary for the first time since The Merge Over 8,000 Ether have been burned in the last seven days, bringing the annual rate to -0.354%.
In addition to the FTX debacle hampering the price of Ether, a massive amount of futures liquidations saw the price hit a 4-month low of $1,070 this week.
Bitcoin price is back below June lows
Data from Cointelegraph Markets Pro shows that Bitcoin has lost 20% of its value in the last week as well. Additionally, Bitcoin hit a new yearly low of $15,742 due to the FTX crash.
Furthermore, the Bitcoin price crisis is driving miners to sell at an accelerated rate, adding to the downward pressure.
According to Charles Edwards, founder of the Capriole Fund, Bitcoin miners hit the red level on the Bitcoin Miner Sell Pressure chart, showing the highest sell-off in almost five years.
Bitcoin miners are in pain and selling more than they have in almost 5 years!
Introducing: Bitcoin Miner Sell Pressure.
A free, open-source indicator which tracks on-chain data to highlight when Bitcoin miners are selling more of their reserves than usual. pic.twitter.com/sXpxXXdUiW
— Charles Edwards (@caprioleio) November 11, 2022
The spike in miner sales has also coincided with a Bitcoin whale moving 3,500 BTC for the first time since 2011.
Is Bitcoin near a bottom?
But analysts disagree that BTC has bottomed out. For example, trader Mags sees two possibilities.
the analyst said:
“The bottom is already at ($15,500) and we run ahead of everyone expecting $14,000,” Otherwise, “We see a deep retracement and go way below $14,000, maybe $11,500-$12,000.”
Other popular analysts like “John Wick” do not believe that the bottom has been reached.
“I warned everyone and said if this bottom end of support broke, I would go short again,” he said. “I also mentioned that I didn’t think the lows were around. I hope they opened their orders early.”
I gave everyone heads up and said if this lower end of the support broke that I would short again. I also mentioned that I did not think the lows were in.
I hope you put in your orders ahead of time
Dots again catching the move early and have predicted every move https://t.co/FVF0aMSq3X pic.twitter.com/ADlgNyBcC8
— John Wick (@ZeroHedge_) November 11, 2022
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