The Bitcoin price has climbed from $6,300 to $6900 on Monday. Bitcoin tentatively appeared to be on the curve of breaking past $7,000 as the Tether (USDT) liquidity result eventually created a breakout. The top-ranked cryptocurrency rose at $6,900 before a pullback saw it drop over $300 but still preserve a convincing 24-hour price variation.
Coinlib’s Bitcoin Price Index reveals that just after 5:00 UTC on Monday, bitcoin saw an unexpected growth of $400 over the course of 70 minutes, and touched as high as $6,960 by 6:45 UTC – a level not observed since Sept. 6.
Bitcoin Price
As of writing, bitcoin’s price has fallen back slightly to around $6,500
Meanwhile, the entire cryptocurrency market has also witnessed a related growth approximately at the same time. According to data from Coinlib, the cumulative crypto market capitalization noticed an unexpected rise right after 5:00 UTC and escalated beyond $207 billion before 6:00 UTC, marking a 3% increase within 70 minutes.
The top 10 cryptocurrency assets by market capitalization were also exhibiting 3-7% percent accruals over the last 24 hours with ethereum, XRP and bitcoin witnessing the highest increases so far. Also prominently, among the top 10 crypto assets, USDT, the U.S. dollar-pegged cryptocurrency started by Tether, is the only asset that is encountering a slump. The token is down more than 6% at the time of writing, recording a yearly-low at $0.95.
Bitcoin, Tether, and Bitfinex
The price of Bitcoin has regularly been affected by changes in stablecoin Tether (USDT). So, it’s somewhat unusual that Bitfinex, the cryptocurrency exchange behind Tether LLC is directing the management. All exchanges that have USDT combined, including Huobi and OKEx, are viewing Bitcoin traded at a premium price, as traders proceed to start the largest selloff of USDT so far.
Bitcoin is being exchanged with a notable prize on exchanges that have blended USDT such as OKEx and Huobi, because dealers have launched the significant sell-off of USDT to date. An unexpected hole of USDT led the price of the Tether to drop to $0.95 by around 6 percent from its peg at $1. The decline in the utility of USDT developed a bounty on Tether-integrated cryptocurrency exchanges.
Bitcoin’s Technical Details
Today, the hourly MACD for BTC/USD is situated in the optimistic zone. At the time of writing this article, the hourly RSI (Relative Strength Index) is beyond the 50 level. Major support level is $6,400 and the major resistance level is $6,520.
Tether and Bitcoin Price
It is still not clear why Tether has encountered the 6% decline, but such action will likely alarm investors given the long track record of suspicious activity circling Tether. The decline is vital since USDT remains to rule the market, valuing for approximately 98% of the cumulative periodic trading volume of all stablecoins, as well as 60% of Bitcoin’s regular trading volume. As a result of Tether’s recession, the AltDex 100 Index (ALT100), a benchmark index for major cryptocurrencies and tokens that prominently does not cover stablecoins, is now at 3.40%.
A few days ago, the Noble Bank International, a full-reserve bank providing real-time post-trade services to OTC markets including FX and cryptocurrencies was on the verge of insolvency. The Puerto Rico-based bank was said to be struggling to survive because of the backlash in the cryptocurrency markets.
Tether is one of the most controversial coins on the market today. A few days ago, researchers, John Griffin and Amin Shams, of the College of Texas at Austin’s Division of Finance, published their research about Tether. According to them, Tether, a cryptocurrency pegged to U.S. dollars, is manipulating Bitcoin and other cryptocurrency prices.
According to researchers, less than 1% of Tether transactions are associated with 50% of the meteoric rise in Bitcoin and 64% of other top cryptocurrencies. The flow clusters below round prices induce asymmetric autocorrelations in Bitcoin and suggest incomplete Tether backing before month-ends. These patterns cannot be explained by investor demand proxies but are most consistent with the supply-based hypothesis where Tether is used to provide price support and manipulate cryptocurrency prices.
There are lots of speculations over the past 6-7 months that tether really is not backed by anything or if it is backed by anything it is somewhat reserved rather than 100% raised by the US dollar. These speculations are because of the number of disturbing incidents about tether during 2017. Also, the profoundly correlated growth between tether issuance and bitcoin price raises the question of whether Bitcoin growth is driving tether.
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