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Crypto Slaughter Bleeds $8 Billion Wipeout in Minutes; Bitcoin Recovers Swiftly

Crypto Market Bleeds $8 Billion Wipeout in Minutes but Bitcoin Recovers SwiftlyA bombshell lawsuit by the NY attorney general’s office against Bitfinex led to a swift crypto market dump. | Source: ShutterstockBy CCN.com: The valuation of the crypto market dropped by $8 billion in a matter of minutes after the office of New York Attorney General’s office filed a lawsuit against iFinex, alleging Bitfinex of mismanaging $850 million in Tether funds. Bitcoin fell by 7.5 percent at its day’s low point.Following the filing of the lawsuit by the Attorney General against iFinex, the bitcoin price dropped from $5,500 to $5,085 as many investors panic sold.Bitcoin is down about 5 percent in the past 24 hours (source: coinmarketcap.com)But, the bitcoin price has recovered swiftly to $5,170, closing the day with a 5 percent loss.Why did bitcoin recover off of bad news?According to the lawsuit, Bitfinex granted itself access to $900 million of Tether’s treasury in an attempt to “hide” its apparent loss of $850 million.Bitfinex sent $850 million to a company based in Panama called Crypto Capital Corp, failed to get the money back, and took a loan from Tether to sustain the exchange’s operations.The Attorney General’s office alleged that the covert operation of iFinex and the mismanagement of funds could be considered as fraud.The official document read:Issued pursuant to General Business Law section 354, a provision of New York’s Martin Act that confers broad powers on the Attorney General to investigate and halt fraud in connection with securities or commodities, the court order bars the operators of Bitfinex from further draining the cash reserves of Tether, or taking personal distributions or dividends from the reserves.Tether’s lack of public audits and transparency have always been the focal point of critics of the stablecoin. But, some have suggested that the scandal proved Tether did have sufficient cash reserves to back its stablecoin at a 1:1 ratio with the U.S. dollar.Previously, many skeptics claimed that Tether was not backed by the U.S. dollar.Technically, Tether is backed by the U.S. dollar and as said by Bitfinex in its official statement, “both Bitfinex and Tether are financially strong – full stop.”The practices of iFinex, Tether, and Bitfinex are what led the Attorney General’s office to pursue the lawsuit, not whether Tether is backed by the U.S. dollars or not.In that sense, while mostly negative, the Tether scandal proved that at least until November 2018, Tether was backed by cash.The best evidence for Tether actually being backed roughly as its executives claim is that despite years of skepticism, investigations, conspiracies, and now this NYAG move, the peg continues to hold. https://t.co/Trx2JWg8u7— Joe Weisenthal (@TheStalwart) April 25, 2019Tether has been a key stablecoin that acts as the fundamental pairing for most cryptocurrencies. Although the lawsuit portrayed potential malpractices of the company, it showed to a reasonable extent that it is backed by U.S. dollars.1/ I just deleted a tweet response I made regarding the recent NYAG complaint against Bitfinex. I wrote that the NY AG said that tether was fully backed, but that’s not correct. I think it’s implied, but it’s not stated explicitly, and I never want to write anything in accurate.— Ari Paul ⛓️ (@AriDavidPaul) April 26, 2019As Kasper Rasmussen, the director of marketing at iFinex, told CCN:Tethers remain completely stable and 100% backed, so Tether’s reserves always equal or exceed the number of issued Tethers. The only change is that the composition of the assets that provide that backing includes a combination of cash, cash equivalents, and may also include other assets or receivables from loans issued by Tether.How the market will likely move forwardAnalysts remain cautious about the short-term outlook on the cryptocurrency market.Some traders have suggested that purchasing bitcoin’s dip on April 25 could be risky given that it is unclear how the case would move forward.Bitfinex. Careful buying this crash. $BTChttps://t.co/Lz0CSxngv6— Alex Krüger (@krugermacro) April 25, 2019But, based on the reaction of the market in the past 12 hours, the crypto market is showing signs of recovery.Click here for a real-time bitcoin price chart. About The AuthorJoseph YoungHong Kong-Based Finance and Cryptocurrency Analyst. Contributing regularly to CCN and Hacked. Providing unique insights into the crypto and fintech space since 2012.
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Crypto Bulls Wrestle Back Control of BNB after Binance’s $40 Million Hack

Crypto Bulls Wrestle Back Control of BNB after Binance’s $40 Million HackOp-edBinance Coin (BNB) is up by 90% against USDT and 57% against bitcoin since the hack in which 7,000 bitcoins were stolen from the exchange. | Source: ShutterstockBy CCN: Binance, the leading cryptocurrency exchange in terms of volume, suffered a massive blow on May 7 when hackers ran away with 7,000 bitcoins. At the time, the total haul was valued at roughly $40 million. Binance CEO Changpeng “CZ” Zhao was quick to reassure their user base by stating that the exchange will cover the damages through the Secure Asset Fund for Users, or SAFU. Nevertheless, some Binance Coin (BNB) holders panic-sold under the assumption that CZ would dump BNB to pay for the damages. They were wrong. In this article, we show how Binance Coin remains unfazed by the recent 7,000 bitcoin hack.Binance Coin Maintains Parabolic Run Against Tether (USDT)On the day of the hack, BNB plunged by 6.89% against USDT as it opened at 22.2018 and closed at 20.6602. The bleeding continued until May 10 when the market dropped to as low as 18.30 for a total loss of 17.57% due to the hack. Since then, the BNB market has been incredibly bullish.Binance Coin in the pedal to the metal mode even after the hack | Source: TradingViewA look at the daily chart shows that the pullback from the hack was nothing but a setup for a big comeback. Bulls resumed the parabolic run on May 10 and have not looked back since. On its way up, it converted former resistance of 24 into support. On May 25, Binance Coin even made a fresh high against Tether at 35.4888.From the low of the hack, BNB is up by 90% against USDT. More importantly, it looks like the ascent is not going to stop soon.Binance Coin Looks Awfully Strong Against BitcoinBinance Coin performed poorly against bitcoin following the security breach. On May 7, it opened at 386,230 satoshis (0.0038623) and closed at 353,680 satoshis (0.0035368) for an 8.43% drop. The plummet continued until May 11 when the market nosedived to 276,450 satoshis (0.0027645). All in all, Binance Coin suffered a 28.42% loss against bitcoin due to the theft.Binance Coin recovering nicely after the hack against bitcoin | Source: TradingViewIn the chart above, you see how the bulls used the drop to convert former resistance of 280,000 satoshis (0.0028) into support. Once that level was cemented, Binance Coin went on a strong V rally and climbed as high as 436,050 satoshis (0.0043605) on May 24. That’s a staggering growth of more than 57.73% from the low of 276,450 satoshis (0.0027645) on May 11.In addition, Binance Coin appears to be forming a large symmetrical triangle on the daily chart. This pattern suggests a continuation of the current bullish trend. If our read is correct, the crypto might go as high as 500,000 satoshis (0.005) in the next few weeks.Bottom LineThe hack may have stalled Binance Coin’s run against Tether and bitcoin. Nevertheless, the crypto remains unfazed. It has not only managed to recover all losses, but it also skyrocketed against both USDT and BTC. Bears should closely reconsider their position or risk getting slaughtered.Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN.Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN. About The AuthorKiril NikolaevKiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor’s degree with a specialty in finance.Kiril’s current focus is on cryptocurrencies and funds, as he does his own crypto research and is a Product Manager at Mitre Media. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing.He owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.This article was edited by Gerelyn Terzo.
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Crypto Bulls Wrestle Back Control of BNB after Binance’s $40 Million Hack

Crypto Bulls Wrestle Back Control of BNB after Binance’s $40 Million HackOp-edBinance Coin (BNB) is up by 90% against USDT and 57% against bitcoin since the hack in which 7,000 bitcoins were stolen from the exchange. | Source: ShutterstockBy CCN: Binance, the leading cryptocurrency exchange in terms of volume, suffered a massive blow on May 7 when hackers ran away with 7,000 bitcoins. At the time, the total haul was valued at roughly $40 million. Binance CEO Changpeng “CZ” Zhao was quick to reassure their user base by stating that the exchange will cover the damages through the Secure Asset Fund for Users, or SAFU. Nevertheless, some Binance Coin (BNB) holders panic-sold under the assumption that CZ would dump BNB to pay for the damages. They were wrong. In this article, we show how Binance Coin remains unfazed by the recent 7,000 bitcoin hack.Binance Coin Maintains Parabolic Run Against Tether (USDT)On the day of the hack, BNB plunged by 6.89% against USDT as it opened at 22.2018 and closed at 20.6602. The bleeding continued until May 10 when the market dropped to as low as 18.30 for a total loss of 17.57% due to the hack. Since then, the BNB market has been incredibly bullish.Binance Coin in the pedal to the metal mode even after the hack | Source: TradingViewA look at the daily chart shows that the pullback from the hack was nothing but a setup for a big comeback. Bulls resumed the parabolic run on May 10 and have not looked back since. On its way up, it converted former resistance of 24 into support. On May 25, Binance Coin even made a fresh high against Tether at 35.4888.From the low of the hack, BNB is up by 90% against USDT. More importantly, it looks like the ascent is not going to stop soon.Binance Coin Looks Awfully Strong Against BitcoinBinance Coin performed poorly against bitcoin following the security breach. On May 7, it opened at 386,230 satoshis (0.0038623) and closed at 353,680 satoshis (0.0035368) for an 8.43% drop. The plummet continued until May 11 when the market nosedived to 276,450 satoshis (0.0027645). All in all, Binance Coin suffered a 28.42% loss against bitcoin due to the theft.Binance Coin recovering nicely after the hack against bitcoin | Source: TradingViewIn the chart above, you see how the bulls used the drop to convert former resistance of 280,000 satoshis (0.0028) into support. Once that level was cemented, Binance Coin went on a strong V rally and climbed as high as 436,050 satoshis (0.0043605) on May 24. That’s a staggering growth of more than 57.73% from the low of 276,450 satoshis (0.0027645) on May 11.In addition, Binance Coin appears to be forming a large symmetrical triangle on the daily chart. This pattern suggests a continuation of the current bullish trend. If our read is correct, the crypto might go as high as 500,000 satoshis (0.005) in the next few weeks.Bottom LineThe hack may have stalled Binance Coin’s run against Tether and bitcoin. Nevertheless, the crypto remains unfazed. It has not only managed to recover all losses, but it also skyrocketed against both USDT and BTC. Bears should closely reconsider their position or risk getting slaughtered.Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN.Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN. About The AuthorKiril NikolaevKiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor’s degree with a specialty in finance.Kiril’s current focus is on cryptocurrencies and funds, as he does his own crypto research and is a Product Manager at Mitre Media. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing.He owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.This article was edited by Gerelyn Terzo.
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