© Reuters
Investing.com – Against the tide of traditional markets, which rebounded amid a flurry of risk appetite on Monday, the and the crypto market in general plunged, with the market’s top cryptocurrency falling as low as a low of $26,542 in the afternoon, compared to a peak just under $28,000 at midday.
Currently at $27,000, the price is down around 3% over 24 hours. The , which is approaching the key support of $1700, is retreating in the same proportions.
Bitcoin plunges as CFTC sues Binance
About the reasons for this sharp drop, it should be noted that they seem directly linked to the announcement of lawsuits by the American CFTC against Binance, the largest crypto platform in the world.
The regulator is suing Binance and its chief executive Changpeng Zhao, better known as CZ, for allegedly violating trading and derivatives rules. The CFTC filed suit Monday in federal court in Chicago.
The CFTC also said that Binance and many other corporate vehicles were operated “through an intentionally opaque joint venture, with Zhao at the helm as owner and CEO of Binance.”
Note that the CFTC recommended in its complaint a permanent ban on Binance activities.
Beyond the direct implications for the market, knowing that Binance is responsible for a significant proportion of BTC trading every day, these lawsuits are further evidence of how tough regulators are on the cryptocurrency industry.
Banking optimism, a bearish factor for BTC?
Beyond the negative surprise of the CFTC’s lawsuit against Binance, some analysts also pointed out that bank stocks broadly rebounded yesterday amid waning concerns over the banking crisis.
However, it has been more or less admitted that the banking crisis in recent weeks has benefited Bitcoin, because it has highlighted the shortcomings of the traditional financial system, in fact rekindling the flame of those who believe that crypto is an alternative.
Therefore, just as the misfortune of the banks made the happiness of Bitcoin, the decline in concerns about the solvency of financial institutions could penalize the cryptocurrency.
Technical thresholds to watch on Bitcoin
From a graphical point of view, it should be noted that the fall of Bitcoin on Monday had little effect on the daily trend, as seen in the graph below:
On the other hand, a continuation of the decline below $26,500 would constitute a negative signal which would put the target at the $25,200/25,000 zone. Below this zone, Bitcoin’s positive bias will then be challenged, and $24,000 will be the first support to consider.
In the event of a rebound, the psychological threshold of $28,000 is the first significant obstacle, before last week’s high around $28,800, then the psychological thresholds of $29,000 and especially $30,000.