Bitcoin and Ethereum Suffer Flash Crash; Binance Coin Rides Bullish Wave: The Living Market

Monday Madness as Bitcoin (BTC) and Ethereum (ETH) suffer a flash crash and Binance Coin (BNB) continues to ride it’s bullish wave. Mass liquidations see Bitcoin and Ethereum prices drop 10 -15% but both have since recovered and more projects opt to use the Binance Smart Chain (BSC) network.

Bitcoin $54,038.88 (-5.74%) has started off the week with Monday madness. The price of Bitcoin plunged $10,000, from $57,000 (00:30 CET) to $46,703 (15:15 CET) on Coinbase — shaving of $70billion of its market capitalization. According to Bybyt, $3.6billion worth of Bitcoin derivative positions have been liquidated, with The Block reporting that exchanges ” liquidated traders’ overleveraged positions.” Cointelegraph reported that $1.5billion worth of Bitcoin were transferred to the crypto exchange Gemini. This Monday’s madness took an ironic twist as US Treasury Secretary Janet Yellen called bitcoin “extremely inefficient” minutes after Bitcoin crashed. Despite the bearish price action, Bitcoin recovered back to $54,032 within 45 minutes of dipping.

Following in Bitcoin’s footsteps, Ethereum $1,775.33 (-7.55%) found itself in the red after tumbling from $1943.28 to $1576 at 15:20 CET. According to Coindesk, $25million worth of DeFi loans were liquidated as a result of ETH’s price drop, with gas fees soaring to $29 per transaction. Since the afternoon crash, ETH rebounded back to $1771.01 within half-an-hour.

As Bitcoin dumps and pumps, Binance Coin $261.78 (-7.03%) has continued its impressive price run, recorded +103.9% over the past 24-hours. This surge has seen BNB surpass both Polkadot and Tether in market capitalization, as the Binance Smart Chain (BSC) becomes an ever greater threat to the Ethereum network. In the past couple months, projects such as Value DeFi and Harvest Finance have moved to the BSC, with Binance CEO, CZ tweeting “BNB started as a token on ETH, but maybe ETH will end up as a token on BSC.”

Market Structure

The market bleeds as the Top Crypto Assets tumble -5.19% for the day. Great volume has entered the market, but much of the action is on the sell side. Stablecoins gain +1.12% due to less supply available in exchanges (Percent Balance on Exchanges, 10.38%). However, it seems that most investors are packing their bags with more USDT (+44.42% 24-hour Volume Traded) awaiting the next big move.

Elon Musk fuels the sell-off as he tweets that Bitcoin’s price may be excessive. Furthermore, inflation risk is overtaken by the danger to the long-term job market in the U.S., and the market reacts accordingly.

The Living Market
BTC, ETH, BNB Weekly Chart

News and Follow-Ups From Around the Industry

The Austrian Financial Market’s Authority has noted a record in whistle-blower reports in 2020, with two-thirds of the cases related to crypto. According to Bloomberg, FMA spokesman Klaus Grubelnik said that “We see a great need for stricter regulation,” in a press briefing on Friday.

Swiss Exchange Traded-Product’s (ETP) company, 21 Shares, hits $1billion AuM. According to a press release on Monday, “rapid appreciation and acceptance from institutional investors” as well as the company’s “proven track record” have been the reasons for 21 Share’s success.

Dan Ives, the Managing Director of Wedbush Securities has told CNBC that he believes that “3-5% of public companies will go down this [Bitcoin] route from an investment perspective.” However, Webb also notes regulation and standardization would need to improve if more companies were to hold Bitcoin.

Multi-Asset Performance Matrix

Multi-Asset Performance Matrix Source: Swiss Block

Disclaimer: All information in this publication is provided for general information purposes only. This publication is not investment advice and is not intended to be. This publication does not constitute and is not intended as an offer, recommendation, or solicitation to invest in any financial instrument, including cryptocurrencies and the like. The contents in the publication represent the personal opinions of the respective authors and are not suitable or intended as a basis for decision-making.

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