Selling Force Makes the Market Fall

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2021-11-26 00:51:10

The selling force of BTC causes the price to fall

BTC price after correcting and returning to fluctuate around $46,000. Although the price went down a lot within a day, in 1 week BTC only decreased by 5% because it had increased a lot before. Most other altcoins also adjusted.

The phenomenon of Long squeeze has also occurred and is believed to be a big cause of BTC price going down. Liquidation caused the volume of Long orders to drop sharply and the day before, it has not recovered. Funding rate to negative level has also recovered to above zero but the long/short difference is not large.

The amount of profitable BTC that increased when the price increased has also corrected to 80.5%.

The sudden price drop causes a certain number of investors to panic and accept to sell at a loss. The Net Realize Profit/Loss indicator has at some point entered the negative zone. This is also reflected in the amount of BTC that has also had a loss.

Those who accept to sell at the loss shown on the on-chain data are short-term investors. The blue line going below 1 is the amount of BTC of short-term investors (storage BTC less than 155 days) moving losses. And long-term investors are almost unaffected.

Although the price went down, BTC was still withdrawn from the exchange in large quantities. There is no sign of a lot of BTC pushing to the exchange to sell but it reinforces the BTC drop by the phenomenon of Long squeeze.

Miners still do not sell when the price goes down, but they continue to accumulate BTC. In general, long-term investors continue to trust and store BTC despite the price drop.

As for Ethereum, it has been 5 consecutive days that it has been pushed to the exchanges more than the amount withdrawn from the exchange.

Coinbase in trouble with the SEC

Previously, Coinbase had implemented a Lending product, sending money to receive interest to customers, and had discontinued this product for a while. In the past 6 months, they have planned to re-deploy this product for qualified customers starting from depositing interest at 4%/year. Lending is a product that most exchanges now provide to customers.

Coinbase is a very law-abiding exchange, so before launching the company worked with the legislature many times before launching. Coinbase has been actively engaged with the SEC on Lend for nearly six months. We look forward to hearing from them as we explore innovative ways for our customers to be more financially empowered on Coinbase.

However, the SEC has announced that if it does, it will sue Coinbase if the company deploys the Lending product without giving any reason. The SEC then said that it considered Lending to be a securities-related service, but would not say why or how it came to that conclusion.

After many efforts to cooperate with the SEC, Coinbase has so far not received an official response to this.

Coinbase has publicly announced its Lending program and opened a waitlist, but has not set a public launch date. Or when receiving a request for documents and a written response, and Coinbase is happy to provide. Some of the requests from the SEC include providing a company witness to testify under oath about the program. Or ask for information about those who are on the Lending service waiting list, but Coinbase has refused because of security requirements for customers.

CEO of Brian Armstrong shared on Twitter and said that there are many exchanges that also offer this Lending service but have not had any trouble with the SEC. So he thinks that the SEC is making it difficult for Coinbase and this is not fair.

Coinbase publicly stated that the SEC is giving them a hard time and they also confirmed that they will postpone the launch of Lending product until October. If they do not receive a response from the SEC they will still deploy this product and need to get a word. explanation from the SEC.

In recent years, inflation has caused assets to continuously grow. The dollar is increasingly depreciating, making people look for assets with better growth. From this, if crypto exchanges or products like Lending open with better interest rates than banks, government agencies fear that people will withdraw money and move from banks to crypto products.

Many people believe that, in order to protect banks, agencies like the SEC are making it difficult for crypto companies and specifically here, Coinbase. Many people including billionaire Mark Cuban have voiced their support for Coinbase. As for SEC Chairman Gary Gensler who has always wanted clearer legislation on the crypto market, hopefully soon there will be an answer with Coinbase.

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