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Bitcoin cryptocurrency rate News

Why did bitcoin plummet to $ 43 thousand? 

Bitcoin plummet

Why did bitcoin plummet to $ 43 thousand? 

Today, September 7, the price of the first cryptocurrency dropped sharply by 16%. Bitxmi experts named the factors that could provoke a drop in quotations.

On the evening of September 7, the price of bitcoin dropped by 16%. For the first time since mid-August, the value of the first cryptocurrency dropped to $ 42.8 thousand. As a result of a sharp decline in quotations and the subsequent liquidation of positions, traders lost more than $ 3.5 billion. Bitxmi experts explained what could have caused the collapse.

Bulk sales

The sharp drop in the bitcoin rate was triggered by several factors, analysts at Bitxmi say. The main reason for the collapse was the sale of a large volume of BTC, including in the OTC market. Everything points to the sale of bitcoin by large miners, analysts say. This put pressure on the course.

Bitcoin miners sold about 2.9 thousand coins last week, according to research firm Glassnode.

The investigations against the largest crypto exchanges

The next possible reason for the collapse of the cryptocurrency rate could be the news that the US Securities and Exchange Commission (SEC) launched an investigation against one of the largest decentralized cryptocurrency exchanges, Uniswap.

Market participants may fear a chain reaction, as a result of which this summer, regulators in many countries began to prohibit or restrict the activities of the Binance crypto exchange. Further movements in the crypto market will depend on the news background.

Binance faced pressure from global financial regulators in 2021. On September 5, it announced the delisting of the Singapore dollar (SGD) trading pairs. The mobile application of the crypto exchange has been removed from the regional platforms App Store and Google Play.

Binance warned that it would stop trading cryptocurrency derivatives in Europe in July. The first countries were Germany, the Netherlands, and Italy. Their residents cannot open new accounts to trade futures or derivatives.

On August 13, Binance announced that some of its products are no longer available to South Koreans and Malaysians. Binance explained the changes in work with the requirements of local authorities.

Expected correction

Another possible factor that triggered the drop in quotations is the decline in many asset classes and stock indices, which is observed on the evening of September 7, the expert explained. For example, the price of gold over the past day has decreased by 2%, while the S&P 500 index fell by 0.30%.

On the morning of September 7, the bitcoin rate updated its maximum since mid-May, reaching $ 52.9 thousand. The asset price exceeded $ 52 thousand after the law on legalizing bitcoin as a means of payment came into force in El Salvador, and the country’s authorities announced the purchase of 400 bitcoins.

After bitcoin fell to $ 42.8 thousand, El Salvador`s  President Nayib Bukele said on Twitter that the country’s government bought another 150 bitcoins during the collapse of quotations.

In the summer, El Salvador passed a law recognizing bitcoin as an official means of payment, along with the US dollar already used as the country’s currency. From September 7, prices in the country can be set in bitcoins, and taxes can also be paid in cryptocurrency. Bitcoin exchanges are not subject to capital gains tax. Read more here.

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Disclaimer: Bitxmi News is a news portal and does not provide any financial advice. Bitxmi's role is to inform the cryptocurrency and blockchain community about what's going on in this space. Please do your own due diligence before making any investment. Bitxmi News won't be responsible for any loss of funds.

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