The signs had been there for the past three days, and finally, on a Sunday of all days, Bitcoin price has finally breached the USD 8,000 support line and now seems to be entering the bearish signals that analysts, both technical and sentiment, have been warning for weeks.
For most of Saturday, we could see European and North American traders trying to prevent this fall, but at approximate 8:00 am Central Europe (2 pm Beijing time), the price finally slipped badly from USD 8,050 to USD 7,950 and is now trading at a low of USD 7,877 (CoinDesk).
Altcoins are managing to hold on a bit longer, letting go of some gains since Friday but not quite yet allowing themselves to fall down beneath key levels, for now at least.
This 1.92% drop will now be the biggest percentage loss since 29 September 2019, and it looks like it may even drop farther in the next few hours. Bitcoin market capitalization is now at a creaky USD 145.6 billion, with a domination rate of just under 66%. This is in contrast to the year’s peak at USD 241 billion.
$BTC – long lower legs and tighter bodies… isn’t that what we look for in reversal candles … and women ? #bitcoin pic.twitter.com/I3G9ChcYzv
— Big Chonis⚔️Flux Trading Group🚀 (@BigChonis) October 5, 2019
Despite price now falling, demand has not petered out. We spoke a few days ago about continued demand for Bitcoin in countries where economic and political turmoil are forcing citizens to seek out alternatives, such as during the uprisings in Hong Kong. But now top London over-the-counter (OTC) trading firm BCB Group is providing extra evidence of increased, not diminished, Bitcoin demand across the other side of the world.
One of its directors, Daniel Fruhman, told Coin Rivet that the daily “chaos” that is involved when closing multi-million dollar Bitcoin deals have not gone away. OTC crypto purchases are mainly popular because big orders would otherwise cause slippage when executed at typical exchanges, owing to the general lack of liquidity there to facilitate large orders.
Fruhman says that BCB Group continues to handle “tens of millions of pounds [sterling]” of trades every week for their clients. He says:
“We’re like a Revolut for business dedicated to the crypto space. You could call us prime brokers as we provide liquidity settlement and clearing, and will soon offer credit and derivatives.”
In addition, he says that institutional investments are definitely on the rise but says that of more significance is the lack of hype from retail sectors, signaling “fundamental changes” that are taking place. Other than the more obvious signs such as Bakkt’s Bitcoin futures, and Facebook’s Libra crypto project, Fruhman says that there are far more crucial indicators of the industry’s growing strength:
“We’re less interested in the price. We look at other metrics that signal strength such as Google Scholar citations about Bitcoin, GitHub commits, VCs investing in the space and jobs being taken for blockchain and crypto developers.”
Meanwhile, the crypto scene in India has remained in a quiet deadlock, with the central bank’s case versus crypto exchanges still in limbo at the Supreme Court. But a recent development just before the weekend suggests that the country is still too busy handling regular financial and banking matters, before it can take on crypto.
A cooperative bank in India was raided at several branches over the week, elevating a crisis that has already seen the Reserve Bank of India (RBI) place regulatory restrictions on the Mumbai-based Punjab and Maharashtra Cooperative Bank (PMC Bank). Customers have also been prevented from accessing savings, after a USD 615 million bank fraud was uncovered.
Allegedly, the bank management colluded with a HDIL group to take out loans. When the loans defaulted, they then used over 21,000 fake accounts to hide the debt. This had apparently remained hidden for over eight years.
Local paper The Economic Times summarized:
“Based on a complaint by an RBI-appointed administrator, the police complaint was filed earlier this week on charges of forgery, cheating and criminal conspiracy against the officials.”
In an age where public trust in banks and the financial system are already at an all-time low, this may push even more Indians to seek out trustless money such as Bitcoin, even if they would have to defy any potential crypto ban by India. Certainly, the pressure is now turned on even higher for a resolution there.
But for now, it seems we have to prepare for a downward trend on this Bitcoin rollercoaster ride. Strap in.
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