Monday, July 22, 2024
Market Analysis

Bitcoin dips under $17K as ‘craziest rumors’ over Binance sink BTC price

Bitcoin (BTC) fell below $17,000 on Dec. 16 as traders warned of overreaction to “FUD” involving exchange Binance and others.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Binance “FUD” fuels bearish BTC moves

Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it put in multi-day lows of $16,928 on Bitstamp.

The pair retraced its entire run to one-month highs courtesy of the latest macroeconomic data and policy update from the United States.

Amid ongoing concerns over the solvency of largest global exchange Binance, market sentiment showed what traders argued was a clear case of cold feet.

The evidence, they suggested, simply did not stack up in bears’ favor.

“The craziest rumours and FUD going around on literally everybody in the crypto exchange business,” Michaël van de Poppe, founder and CEO of trading firm Eight, tweeted on the day.

A further post expanded on who those players are:

“Apparently the consensus is that Tether, Binance, DCG are all going to fall. Potentially even Michael Saylor. Clear, got it.”

Fellow trader and analyst Crypto Ed sounded equally skeptical, drawing attention to Bitcoin’s copycat comedown in line with U.S. equities the day prior.

“Interesting to see everyone suddenly so bearish on BTC as if it’s solely acting so weak. SPX is doing exactly the same, maybe even weaker,” he told followers, querying whether the “Binance fud” really had a role to play.

BTC/USD vs. S&P 500 % change chart. Source: TradingView

Research: Binance reserves data “makes sense”

In examination of Binance’s previous proof of reserves statement, meanwhile, on-chain analytics platform CryptoQuant likewise found little evidence of foul play.

Related: Why is the crypto market down today?

“To evaluate the information contained in Binance’s Proof-of-Reserves report, we compared the liabilities presented by Binance in the report to the on-chain metric data we have at CryptoQuant regarding Binance’s BTC Reserves (our estimation of the deposits made by Binance’s customers),” it explained in a blog post on Dec. 15:

“We discovered that the liabilities stated by Binance are highly similar to our assessment (99%).”

It added that the data Binance supplied about its liabilities “makes sense.”

No amount of reassurance was enough to console BTC price action on the day, however, with $17,000 barely holding at the time of writing.

Popular trader Crypto Tony thus announced entry of “the next wave down for the bears,” amid ongoing predictions of a cycle low at $12,000 or under.

“BTC all as expected … if we consolidate for a while above 16900 I will open a long …. still patient for now,” fellow trader Elizy wrote in a fresh update.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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