Ether reached a price of $ 1,000, and the bitcoin exchange rate dropped below $ 20,000 – these are the realities of the modern crypto world. It's scary to say what happens to other tokens and altcoins, which have lost up to 90-95 percent of their value compared to the beginning of this year. And despite such an active fall, no one is in a hurry to buy the market. Everyone is waiting for today's results of the meeting of the Federal Reserve System, at which the further policy of interest rates will be determined, actually because of which not only the cryptocurrency market is collapsing, but also all American stock indices.
As it became known today, over 13,000 ETH were liquidated on Three Arrows Capital wallets. This happened right after Ethereum dropped to $ 1,020. For a moment, Three Arrows Capital is one of the largest crypto funds in the world at $ 5 billion. What happens in MicroStrategy, I'm afraid to even imagine. Let me remind you that MicroStrategy is already facing a so-called "margin call" — a situation where an investor has to invest more funds to avoid losses on a transaction. The company recently took out a $ 205 million loan from Silvergate, a bank specializing in cryptography, to continue buying bitcoin. To secure the loan, MicroStrategy placed some of its bitcoins as collateral. Many experts said that if bitcoin falls below $ 21,000, and it has fallen, the company will be forced to fix losses, as it will have to sell most of its assets to meet collateral requirements. It is unclear whether MicroStrategy has received additional funds to secure the loan or not. We are waiting for news in this direction, which may bring down the crypto market even more.
In this article, I would also like to touch on a recent interview with Bill Gates, who is known for his skepticism about digital assets. This time he criticized the NFT market, the demand for which has grown recently due to a fairly cheapened number of attractive assets.
Speaking at the TechCrunch conference, the Microsoft co-founder described the NFT phenomenon as something 100% based on the bigger fool theory, referring to the idea that overvalued assets will rise in value when there are enough willing investors to pay more for them. Gates joked, saying that expensive digital images of monkeys will significantly improve the world, referring to the advertised collection of NFT Bored Ape Yacht Club.
Let me remind you that NFTs are tokens that cannot be exchanged for each other. They are often touted as a way to prove ownership of digital assets, such as art objects or sports collectibles. Many NFTs are built on the ether network, the token of which is currently experiencing not the best of times.
"I'm used to asset classes as a farm where products are produced, or as a company that produces something," Gates said. "As for cryptography, I am not involved in this and I have no desire to join this direction."
But cryptocurrencies have fallen sharply this week not only because of the risk of further rapid interest rate hikes in the US. A significant role was played by the company Celsius, which is engaged in lending cryptocurrencies, and suspended withdrawals from accounts. This immediately gave rise to talk about the impending insolvency of Celsius and possible side effects for the entire crypto market.
On top of everything else, just recently another stablecoin, USDD from Tron, dropped to $ 0.955. Tron DAO announced that it would withdraw $ 2.5 billion worth of TRX cryptocurrency from the Binance platform to protect the blockchain industry and the cryptocurrency market. Earlier, the DAO transferred 100 million USDT to Binance to buy TRX. The operation was part of an effort to maintain the stability of the algorithmic stablecoin USDD.
As for the short-term prospects of bitcoin, it is obvious that there are simply no people willing to buy it even at its current lows. To develop the initiative on the part of the bulls, active actions are needed in the area of $ 22,000, but before that, you need to try to return above the price of $ 21,700. Only a consolidation above this range will quickly return the trading instrument back to $ 24,200, allowing investors to calm their nerves a little. A breakdown of the $ 20,700 level and another consolidation below this range will fail the trading instrument to a minimum of $ 19,200, and there you can reach up to $ 18,500 and $ 17,600.
As for the technical picture of the ether
No one is in a hurry to buy the bottom. The recent fall in ether has once again returned investors to a state of nervousness, as the trading instrument was one step away from breaking the psychological mark of $ 1000. It will be possible to talk about building an upward correction only after a breakout of $ 1,170, which will quickly return the ether to $ 1,282, and there is $ 1,406 very close, which will be a serious problem for traders. Only consolidation above will allow building an upward trend for the trading instrument with the prospect of updating the highs in the areas of $ 1,548 and $ 1,721. If the pressure on ETH persists, purchases in the area of the nearest support of $ 1,072 are not excluded. A break in this range will be the reason for a new collapse of the ether and a hike to $ 997. In this case, I advise you to count on new lows: $ 925 and $ 876, where the big players will start to act actively again.
