Today (Christmas, 12/25/2022), Bitcoin completed a small "buy the rumor, sell the news" event. Expectations of a 'Santa Rally' were the rumor (pump), while Christmas day was the news (dump).
With the completion of this move, Bitcoin is now teetering on the edge of a cliff! I'm short BTC, targeting $13.7k - $11k.
Bearish BTC catalysts include:
With the completion of this move, Bitcoin is now teetering on the edge of a cliff! I'm short BTC, targeting $13.7k - $11k.
Bearish BTC catalysts include:
- Binance insolvency: The recent FTX collapse has spooked cryptocurrency investors with assets on exchanges. Consequently, investors are removing liquidity from exchanges at a record pace. Most of these outflows have come from Binance, which accounts for >50% of the cryptocurrency spot and derivatives market. If Binance declares insolvency, then we can expect the crypto market to fall by another 50%. If Binance fails, we may expect Tether, Tron, Grayscale, and other exchanges to collapse.
- Volatility spike: The cryptocurrency volatility index is at historical lows. Volatility slowdowns typically lead to explosive moves. In this case, we can expect an explosive move to the downside.
- United States cryptocurrency regulation: On December 23rd, the US Treasury delayed its tax reporting rules. The US intends to enforce these rules 'soon.' The execution of cryptocurrency tax requirements should drastically affect crypto prices, as Defi protocols and Layer-1 networks will soon be required to collect and send user information to the IRS.
- SEC vs. Ripple settlement: The SEC vs. Ripple lawsuit is expected to settle between March and June 2023. It is believed that the SEC will win this lawsuit, causing XRP to be officially recognized as an 'implied' security. Following this case, all Proof-Of-Stake cryptocurrencies will become 'implied' securities, while Proof-Of-Work cryptocurrencies will be recognized as commodities.
