The rollercoaster ride of the cryptocurrency markets since 2023 continues, with a 40% increase in the first two weeks followed by a bearish pullback. Recently there was a suggestion for a price rebound, but the global market cap dropped by more than 5.3% this weekend due to heavy selling.
It is well-known that the crypto market is heavily impacted by external events, so with several taking place this weekend, a dip is a possibility. Here are two possible catalysts that could cause the crypto market to plunge.
Mt. Gox’s 142,000 BTC Unlock
Creditors of the now-defunct Mt. Gox exchange are finally slated to receive their 142,000 BTC this year, with payments beginning on March 10 and continuing until September 10, 2023. Although many creditors may still possess all or some of their original BTCs, the worry of a sudden influx of BTCs into the market could lead to a dip.
Bitcoin ETP Launch
The Bitcoin exchange-traded product (ETP) is due to launch on the Swiss stock exchange on March 16. While this could cause a surge in the price, if there is a lack of demand, it could result in a plunge. This product is expected to be a major milestone and may become one of the key drivers of the crypto market in the coming years.
These are the leading causes of a possible crypto market dip this weekend. It remains to be seen if the market will bounce back or not.
The crypto market has been notoriously volatile and unpredictable, with sudden dips and rises that can make it difficult to stay on top of. This weekend, traders and investors may be in for a wild ride as there are several factors that could lead to a significant plunge. Here are some of the top reasons why the crypto market may be headed for a downturn.
Ethereum Withdrawal-Shanghai Upgrade
The Shanghai Upgrade is allowing validators to withdraw staked ETH from the Beacon Chain, which was initially scheduled for March but was delayed until April. This could be a positive for the ETH staking industry, but might also lead to an increase in selling pressure.
Silvergate Bank Collapse
The Silvergate Bank, California-based and specializing in cryptocurrency and operating the Silvergate Exchange Network (SEN), has been hit hard by the recent FTX collapse, losing $1 million. This could prompt crypto exchanges to withdraw support, which could have a negative impact on the market.
Macroeconomic Shifts
Recent economic data, such as CPI and PE results, are coming in lower than expected. This increases the chance of a 50 bps increase at the next FOMC meeting, and may also affect the crypto market when CPI data for March 13th is released.
Regulatory Crypto Crackdown
The SEC’s recent crackdown on crypto companies such as Kraken and Paxos, targeting staking products, shows a new aggressive approach to regulation in the space. This could lead to further dips in the crypto market.
