After a bull run since the start of 2023, the market saw a pullback and consolidation in the past week, followed by a bounce mid-week after the CPI print.
The recent government regulation news in the crypto domain was one of the reasons for the correction to the $22,000 level, as reported by XTB, one of the leading FX, stocks and crypto brokers.
Analysts and crypto signals channels have all expressed their idea of where the market might be headed in the upcoming months. However, drawing an accurate picture can be extremely difficult, as the industry has been in a state of uncertainty, with concerns over a Binance USD (BUSD) depeg also adding fuel to the fire.
The Crypto Market in February
Since January, the crypto market had been on a continuous uptrend. The frontrunner cryptocurrency BTC saw an impressive pump when it went from being worth about $16,700 to more than $23,000 within 4 weeks. A majority of top altcoins also made major moves, causing investors to start stocking up on their favourite projects again.
Bitcoin price chart – monthly timeframe via Binance / Tradingview
As the market cap of the cryptocurrency industry crosses $1.09 trillion, the idea of an upcoming bull market was being explored by many. On the contrary, BTC saw more than a 5% drop in price, as it dropped from $23,300 to $22,100.
The RSI indicator which showed that the crypto was being heavily overbought up until a few days ago has also cooled down, which could indicate potential buying once again. Update – the Bitcoin price today spiked a current intraday high of $22,900.
XTB Crypto Price Analysis
On February 10th, XTB released a crypto price news piece which talked about the SEC’s crackdown on companies which could cause a further drop in prices.
There were two events that helped XTB speculate about the price dump:
SEC Action on Kraken Staking
Staking is an easy way to earn extra income and is enjoyed by thousands of people across the globe. There are multiple ways to stake and earn impressive interest. One way of doing this is to simply lock one’s cryptocurrencies on a centralized exchange. Top exchanges like Binance, Crypto.com etc often offer high interest for cryptocurrencies, which entices users to park their funds into their staking pools.
Kraken, which is the third largest crypto exchange in terms of volume traded was under the SEC’s radar for allegedly not complying with some rules. A further probe into the exchange revealed that the exchange had indeed tampered with the law and had not registered its staking program in accordance with the SEC law for securities. Kraken is expected to pay a whopping $30 million fine and immediately close its staking service.
The SEC chairman Gary Gensler stated that the decision had come out of concern for investors, and a rather unfortunate history of multiple exchanges duping its users in the past under the pretext of impressive staking interest rates.
Top Stablecoin Entities May be in Trouble
Paxos and Circle are two of the most popular name in the stablecoins category and have grown in value over the years as market leaders within the domain. Both entities back the BUSD and USDC stablecoins respectively, and are expected to mimic the US dollar with complete accuracy.
However, the SEC seems to have spotted some irregularities within its claim and sent both companies the “wells” notice, which put a lot of pressure on the investors to sell their stablecoins and other altcoins that are a part of their ecosystems. Since BUSD and USDC are highly used stablecoins with impressive daily volume, even a small amount of bad press could mean a further dump in prices too, which is something XTB highlights in its report.
XTB’s Free Crypto Price Analysis
Similar to the recent report talked about in the article, XTB has provided its users with much value since it started posting educational content and important announcements through its market analysis section.
Launched in 2002, XTB serves as a crypto and forex CFD broker, supporting leveraged trading on digital assets and traditional financial markets.
The platform provides access to over 2100 financial markets including FX, indices, shares, commodities and more, where users can trade in more than 5700 global markets. Since its inception, XTB has managed to amass a massive user base and has provided value to its customers in some or the other way throughout the years. Its market update section was a platform-specific development that received a lot of appreciation and is currently used by a huge chunk of its investors.
The section features three types of data – Market News, Price Tables and Market Calendar. While the market news posts articles and important announcements concerning the industry and crypto prices, the price table section functions as an index for finding the price of multiple assets across various markets in one place.
The market calendar, on the other hand, is a very important tool, as it shows impactful events that could change the market conditions, along with the potential influence it may have in the form of three levels.
The market condition has put investors in a place where they may need to choose carefully before injecting funds into any asset. Referring to informative articles and announcements using reliable websites like XTB can be a great way to start treading the volatile waters of the cryptocurrency industry at a time like this.
Find more crypto price action analysis in the free education section at XTB.com.
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