The crypto market saw a significant dip today, with the total market capitalization dropping nearly 2% to around $1.4 trillion.
Several major cryptocurrencies like Chainlink and Rollbit saw double-digit percentage losses, while tokens such as SOL, ADA, and DOGE dropped over 5%. Bitcoin also declined around 2% and was trading near $36,500 at the time of writing.
There appear to be a few key factors driving the crypto sell-off:
What you'll learn 👉
Fake News
Earlier today, false reports circulated that BlackRock had filed for a spot XRP exchange-traded fund (ETF). However, a spokesperson for the asset management firm confirmed this was not true. The inaccurate rumor likely led to some panic selling as traders reacted to the news.
JUST IN: BlackRock has not filed for a Spot XRP ETF, spokesman confirms.
— Watcher.Guru (@WatcherGuru) November 13, 2023
In a telling tweet, crypto investor Miles Deutscher joked about how easy it is to manipulate the crypto market, saying: “Guide to manipulating the crypto market and making millions: Pick a coin, giga long, file for an ETF under BlackRock’s name, spread the news on Twitter, cash out before it’s disproven. Easy money.” This highlights how fake news can be intentionally spread by bad actors to profit from short-term price swings.
Profit Taking After Recent Gains
Crypto prices surged in October and early November, with Bitcoin hitting its highest price in over a month recently. Some large crypto holders may be cashing out gains from the latest rally.
This type of profit taking is fairly common after periods of significant upside momentum.
Impatience Over SEC’s Bitcoin ETF Decision
The SEC has until November 17 to approve or reject a spot Bitcoin ETF in the current review window. With only three days remaining, some traders may be preemptively selling crypto holdings out of frustration or pessimism about the SEC delaying a decision once again.
There is also speculation that investors could be selling to build up cash reserves to buy back crypto assets at lower prices if an ETF is approved.
Overall, the mix of speculative news, profit taking, and uncertainty around key regulatory decisions appears to be driving the latest crypto market slump. However, analysts still believe there is a strong likelihood of a spot Bitcoin ETF being approved in early 2024, which would be a major catalyst for renewed upside in crypto prices.
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