Bitcoin slumps as regulatory battle brews
Bitcoin price recovery failed as the the crypto failed to retest $27,400 resistance it reached on June 6.
This signals investors sentiment towards the coin have turned negative in the wake of Binance and Coinbase being sued by the US Securities and Exchange Commission (SEC) on multiple counts.
Bitcoin succumbs to SEC pressure
Bitcoin has since succumbed to the dreary hands of Gensler as it failed to surpass the crucial $27,400 resistance level. The coin is currently exchanging hands at $26,578 and may face more hurdles to its recovery.
Earlier, the pioneer cryptocurrency managed to cross $27,000 and was poised for the resistance level before the SEC news hit. The coin slipped quickly below $27,000 after it had reached a local high near $27,368.
If Bitcoin surpasses the $27,000 resistance, it might open the door for an ascent toward the $27,400 crucial barrier. By overcoming this resistance area, the price may move closer to the next target level of $28,500.
However, if the $26,600 resistance is not overcome, Bitcoin may slump further. Amounts around $26,200 might be anticipated to receive immediate support. Additional downward pressure might push the price closer to the significant support area at $25,840, perhaps igniting a bearish trend. In such a case, the price may move near the $25,400 support level.
According to crypto analyst Tone Vays, traders shouldn’t be alarmed by Bitcoin’s decline. The $27,500 level has a part to play in his estimate, according to the analyst who held a live session with his YouTube audience.
Vays said, “The region is the catalyst to be 100% bullish in Bitcoin. If we go above $27,500 and close above the red candle, then I would be comfortable that we’re in the bullish market once again.”
SEC suits endangers market
It appears that the SEC attempt to police the crypto space is negatively affecting the market. The duo suits have had some investors exit the market. Others are hoping for a positive outcome in the US House Financial Services Committee hearing scheduled for June 13.
The SEC suits have got people talking, including the US legislature. Sen. Bill Hagerty stated that regulators at the SEC are “weaponizing their role” and publicly called out SEC Chairman Gary Gensler.
Between June 5 and June 7, the median trade volume on the top three decentralized exchanges (DEXs) increased by 444%. As DEX volumes increased, net outflows on Binance.us—the difference between the value of assets entering and leaving the exchange—reached $778M.
“Market-makers are obviously pulling liquidity from the exchange,” said Conor Ryder, research analyst at Kaiko. “Worsening US liquidity is something that has been playing out over the course of a few months, but this seems to be the straw that broke the camel’s back for liquidity on Binance.US.”
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