Bitcoin glued to $36,000 as uncertainty prompts trader caution
07:27, 7 June 2021
Cryptocurrency trading volumes continued to decline over the weekend, but the price of bitcoin stayed close to the middle of its recent variation level, at $36,000. Uncertainty around bitcoin’s evolution has been keeping individual traders out of the market.
Factors affecting the market ranged from El Salvador recognising bitcoin as legal tender to China’s Weibo blocking a large number of cryptocurrency key opinion leaders. Elon Musk was also busy on his social media channels, but his latest tweets had little impact on the market.
As the Crypto Fear & Greed Index is still down in the “Extreme Fear” zone, traders are waiting for the next big news that will bring back some action.
Bitcoin lovers and haters
El Salvador, a country of 6.5 million people in Central America, is working on a bill to recognise bitcoin as legal tender, President Nayib Bukele announced on Saturday. The bill’s approval would likely make El Salvador the first nation to adopt a bitcoin standard, according to CoinDesk.com.
In the US, Texas passed a series of amendments creating a legal framework for cryptocurrencies and blockchain, Governor Greg Abbott announced on Twitter. Texas joins the state of Wyoming and the city of Miami in supporting these new technologies. "Blockchain is a booming industry that Texas needs to be involved in", Governor Abbott said.
Meanwhile, the crackdown on cryptocurrencies continues in China as the social media platform Weibo, China’s alternative to Twitter, blocked the accounts of many crypto influencers. “This is the harshest suspension of crypto in history, and it may be a response to Beijing's crackdown policy,” Chinese journalist Colin Wu wrote on Twitter.
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The Elon Musk effect
The most commented bitcoin “event” in recent days was Elon Musk’s new series of tweets describing what seems to be a complicated love affair with the world’s leading cryptocurrency. Slipped between news of SpaceX’s latest missions, tweets such as “Don’t kill what you hate, Save what you love” and “Goods & services are the real economy, any form of money is simply the accounting thereof” left many wondering what the Tesla billionaire’s new feelings for bitcoin are.
One day earlier, Musk posted a photo of a couple breaking up and a broken heart emoji next to the #bitcoin hashtag.
A video on YouTube claiming to be from the hacker group Anonymous criticizes the Tesla and SpaceX CEO for bringing down the cryptocurrency markets with his tweets, which the group says destroys the lives of hardworking people.
Bitcoin’s intra-day movement has tempered
The hype around cryptocurrencies has tempered in the last week. Bitcoin’s intra-day volatility has declined and the daily trading candles have become shorter. The average gap between bitcoin’s daily highs and daily lows over the last seven days was 8% on Sunday 6 June, down from 12.4% on the previous Sunday (30 May) and 18.8% two weeks ago (23 May).
On Monday morning, bitcoin was trading close at $36,000, almost unchanged over the last 24 hours, while its seven-day variation was just 1.2%, according to Coinmarketcap.com.
Meanwhile, ethereum was trading at $2,750, up 2.8% over the last 24 hours and almost 13% over the last 13 days. Binance coin and dogecoin showed the biggest seven-day gains among the top 10 digital currencies, both rising over 20%.