It seems that Bitcoin’s merry run vanished even before investors could sit back and enjoy the profits. Bitcoin dropped to $8,400 before regaining some ground.
Just when investors started to feel confident about Bitcoin investments, the world turned upside down for them. All of Bitcoin’s gains vanished in a matter of minutes.
Timing of the BTCUSD crash doesn’t seem to be a coincidence
Just when BTCUSD reached $10,000, the Coinbase platforms gave a message stating its servers went down. In my previous article, I mentioned how analysts felt that was fishy. That article can be found here.
Several investors assumed Bitcoin to be finally on a Bull run after it crossed $10,000. Investors could potentially lose millions in this crash. A group of analysts claimed that it could be the whales who were indulging in manipulations.
‘The Big-short’: Not in stocks, but Bitcoin this time
If it were the whales, who inorganically drove BTCUSD higher, would have taken a short position in Bitcoins. They would now be sitting on an enormous profit. BTCUSD manipulators always make more money when the market crashes than when the market shoots up.
It is not only the manipulators but the exchanges as well who would benefit from the crash. Bitcoin exchanges offer up to 100X or 100 times leverage to its users to trade BTCUSD.
So if someone were long in Bitcoin, when it was on the rise, would now have lost a lot more than the capital invested. The exchange takes its share of commissions on the leverage as well.
Looking at the BTCUSD hourly chart shows that it might drop to potentially dangerous levels before bottoming out.