Bitcoin has seen a major downfall in its market strength over the past week with a drop of about 20% in its price. According to Thomas Lee, the Head of Research at Fundstrat Global Advisors, this steep plunge is due to the expiration of futures contracts linked with Bitcoin [BTC] on Cboe and CME. Lee also stated that there is “extreme volatility” around the futures contracts of these platforms.
He furthers explained the average 18% fall of BTC prices in a span of about 10 days that preceded the expiration. Going long has hampered the profits of many at this point, while the short position has proved to have brought handsome profits to the traders; which is bound to happen during a financial crash of such nature. As the expiration date approaches, the pressure to sell gives way to profits for the buyers.
Jeff York PPT, a Pivot Point Technician and a Twitterati, writes:
“Tom’s predictions in 2008 was very wrong. His predictions in 2018 will be very wrong again, imo.”
Another BTC trader, comments:
“When there’s more money flowing in ‘futures’ than there is in the ‘main market’, then there’s bound to be some serious mess. We need more $$$ in, period, and this issue, and the misguided suggestion that there is manipulation, will be moot.”
Shawnster, an economics nerd and a crypto bag holder also spoke:
“Can always count on Wall Street and the Banks to ruin everything…as soon as Futures get’s introduced it is not a true market”
After dropping as low as $6,310 this week, Bitcoin showed a 1.21% rise at the time of writing, trading at $6,552.88 with a market capitalization of $112 billion. However, at the beginning of May, BTC prices rocketed close to $10,000. Rapid price fluctuation of Bitcoin has been a major concern for the crypto community actively involved in trading Bitcoin.
The post Bitcoin: Fundstrat’s Tom Lee places the onus of BTC crash on futures appeared first on AMBCrypto.