Cryptogeddon: Bitcoin Battered Below $4000 As Long Liquidations Continue

Tyler Durden's Photo
by Tyler Durden
Saturday, Nov 24, 2018 - 20:16

Amid a series of liquidations of large long positions, Cryptocurrencies have crashed to fresh 2018 lows today with Bitcoin blowing through the $4000 level.

It's a sea of red...

Source: Coin360

With the majors down 8-13%...



But, as CoinTelegraph reports, Michael Moro, the CEO of cryptocurrency trading companies Genesis Trading and Genesis Capital Trading, said that the Bitcoin (BTC) price could bottom at $3,000 in an interview with CNBC Nov. 23.

image courtesy of CoinTelegraph

Speaking on CNBC’s “Squawk Box,” Moro suggested that the leading cryptocurrency will lose another 30 percent before bottoming at $3,000. Moro said, “You really won’t find [the floor] until you kind of hit the 3K-flat level.”

Moro addressed small resistance levels, saying that he does not think the BTC price can stabilize in “the mid-3s,” also noting that the $4,000 level was tested twice in the previous days.

The crypto trader said that long-term investors are more poised to handle BTC’s slump and wait until the price rebounds, while at the same time advising not to buy the cryptocurrency at the dip:

“This is about the fifth or sixth 75 percent-plus drawdown that we’ve seen in the 10-year history of Bitcoin.

And so if you have that [long-term] lens, I don’t believe institutional investors really ultimately care where the price of Bitcoin ends in 2018, simply because they’re looking at things three to five years out.”

When asked about what the low price of Bitcoin could mean for miners, Moro suggested that the cost to mine one Bitcoin will go down because “the hash rate has dropped.”

The recent cryptocurrency market decline has resulted in a similar drop in mining profitability and forced Chinese operators to sell their mining devices at a loss. Some mining machines are being sold on the second-hand market for merely 5 percent of their original value.

Bitcoin’s price has kept falling, along with the rest of the crypto market, since the hard fork network upgrade of Bitcoin Cash (BCH) that took place Nov. 15.

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Bitcoin’s share of total cryptocurrency market cap has increased to just over 55% compared to an all-time low of around a third at the turn of the year, meaning that other cryptocurrencies have suffered disproportionately during this reversal.

Furthermore, as JPMorgan notes, the latest decline in prices has also seen a sustained decline in the hash rate according to data from

This suggests that prices have declined to a point where mining is becoming uneconomical for some miners, who have responded by turning their mining rigs off.

While the listing of Bitcoin futures by the CBOE and CME in December last year made it possible for financial institutions to gain exposure to cryptocurrencies via widely recognised platforms, participation has remained rather modest.

As Figure 14 shows, open interest in the CME contract, where it has increasingly concentrated, has remained relatively stable at around $100mn on average since end-April, though given the decline in the price of Bitcoin this masks some increase in open interest in terms of units of Bitcoin. And while volumes haveat timesspiked sharply higher to over $500mn at their peak, average daily volumes have remained at arather less spectacular $150mn per day since early April on the CME contract, and just over $30mn per day on the CBOE contract.

Indeed, the futures volumes as a proportion of trading volumes on bitcoin exchanges has been relatively stable at just over 3% on average since mid-March, and have only temporarily risen meaningfully above that level.

For now Bitcoin trades at its lowest since September 2017...

An effect of the plummeting cryptocurrency prices is a significant depreciation to the capitalization of the entire market. Just seven days ago, the market was valued at $182 billion, but that number has since fallen $54 billion, or 30 percent to where it now stands at $128 billion, its lowest value since September 2017.