Selling power drops the market
BTC’s selling power is making the price drop
BTC price after correcting and returning is hovering around $ 46,000. Although the price fell sharply in one day, BTC only fell 5% in 1 week as it had risen sharply before. Most of the other altcoins have also been adjusted.
A long squeeze phenomenon has also occurred which is believed to be a major cause of the decline in the BTC price. The liquidation led to a sudden drop in the number of long orders and no recovery was seen on the previous day. The funding rate at negative levels has also rebounded to above zero, but the long / short difference is not large.
The amount of profitable BTC that increased when the price went up has also corrected to 80.5%.
The sudden drop in prices caused a number of investors to panic and accept the sale at a loss. The Net Realize Profit / Loss indicator entered negative territory at some point. This is also reflected in the amount of BTC that has also suffered a loss.
Those who accept to sell at the loss reported in the on-chain data are short-term investors. The blue line that goes below 1 is the amount of BTC from short-term investors (storing BTC less than 155 days) moving losses. And long-term investors are almost unaffected.
Even though the price fell, BTC was still removed from the exchange in large quantities. There is no sign of a lot of BTC going public to sell, but it is compounding the BTC decline from the long squeeze phenomenon.
Miners still don’t sell when the price goes down, but they keep accumulating BTC. In general, long-term investors continue to trust and store BTC despite the drop in prices.
Ethereum was pushed onto the exchanges for 5 consecutive days than the amount withdrawn from the exchange.
Coinbase in trouble with the SEC
In the past, Coinbase implemented a lending product that sends money to receive interest to customers and discontinued that product for a while. In the last 6 months they have planned to use this product again for qualified customers, starting with the payment of interest at the rate of 4% / year. Lending is a product that most exchanges are now offering to their customers.
Coinbase is a very law-abiding exchange, so before launching, the company worked with lawmakers many times before it launched. Coinbase has been actively working with the SEC on lend for nearly six months. We look forward to hearing from you as we explore innovative ways for our customers to gain more financial power on Coinbase.
However, the SEC has announced that the agency will sue Coinbase if the company uses the lending product for no reason. The SEC later said it viewed lending as a securities-related service but did not want to say why or how it came to that conclusion.
Coinbase has not yet received an official response on this after much effort to work with the SEC.
Coinbase has publicly announced its lending program and opened a waiting list, but has not set a public start date. Or when you receive a request for documents and a written response that Coinbase will be happy to provide. Some of the SEC’s inquiries include providing a company witness to testify under oath about the program. Or ask for information about those who are on the waiting list for the loan service but Coinbase has declined for security reasons for customers.
Brian Armstrong’s CEO shared on Twitter, saying that there are many exchanges that also offer this loan service but have not had any issues with the SEC. So he thinks the SEC is making it difficult for Coinbase and that’s not fair.
Coinbase openly stated that the SEC is making it difficult for them, and they also confirmed that they will postpone the launch of the lending product until October, and if they don’t get a response from the SEC, they will still use this product and will have to provide a statement the SEC.
In recent years, inflation has resulted in steady asset growth. The dollar is increasingly depreciating, causing people to look for assets with better growth. Therefore, when crypto exchanges or products like lending are opened with better interest rates than banks, government agencies fear that people will withdraw money and switch from banks to crypto products.
Many people believe that to protect banks, agencies like the SEC make it difficult for crypto companies and Coinbase in particular. Many people, including billionaire Mark Cuban, have expressed support for Coinbase. As for SEC chairman Gary Gensler, who has always wanted clearer legislation in the crypto market, hopefully there will be an answer soon with Coinbase.