Evegrande bankruptcy – The market is as fearful as it was in May

Evergrande Fails, Cryptocurrency Market Falls

The crypto market is mostly red due to the influence of Evergrande news. Bitcoin fell to about $ 47,000 the previous day. Most altcoins are falling in line with the BTC trend.

The unemployment report shows that the number of people receiving unemployment benefits is at its lowest level in 52 years. This is good news for financial markets, but US stocks are still falling.

Fitch Ratings has downgraded the company and its subsidiaries Evergrande to Limited Default, which means that the company has not met its financial obligations. As defined and referred to by Fitch, a company that has repayment of unsecured debt but has not yet entered into bankruptcy, liquidation or other formal closure.

Fitch said the downgrade reflects the company’s inability to pay interest due earlier this week on the two dollar-denominated bonds. Payments were due a month ago and the grace period expires next Monday. During this time, Evergrande did not announce payments and did not respond to questions from the rating agency.

Evergrande has a total debt of about $ 300 billion. Analysts have been worried for months about whether the default could trigger a broader crisis in the Chinese property market that could wreak havoc on homeowners and the entire financial system. Last month, the US Federal Reserve warned that problems with Chinese real estate could put pressure on the global economy.

According to this information, Evergrande either did not respond or did not respond. And earlier this week, China’s central bank also prepared $ 188 billion to pump into the market in the worst case scenario.

The reaction and fears of investors reflected on the stock indices. The more investors in the traditional financial market are currently participating in the cryptocurrency market, the stronger the influence of the trend.

Online situation

Bitcoin was fixed to $ 48,000, winning percentage dropped to 73%. This is in line with the bitcoin price in May, when bitcoin fell from a high to $ 37,000.

The Fear and Greed Index is currently showing fear mood at around 24, around the same time as the May drop in BTC.

The proportion of the amount of BTC stored is the difference compared to May. Currently, the price of BTC has decreased, but the amount of BTC stored has increased. In May, the price fell, but the amount of BTC held also decreased, which means that the amount of BTC in circulation in the market has increased (red line).

At the same time, Bitcoin continues to leave the soil on stock exchanges. In contrast to May, the price fell, and the amount of BTC on the exchanges increased.

The BTC amount deposited on the exchange on the previous and last day is greater than the amount withdrawn from the exchange. The amount of BTC that is promoted to the trading floor is considered to be the reason for the decline in the price of BTC.

The BTC amount is transferred to both regular (spot) exchanges and derivatives exchanges. However, the data shows that most of the BTC is accumulating on derivatives exchanges.

Most of the recent downturns, panics and selling have come from short-term investors. The Short-Term Holders Index shows that there are times when short-term investors (holding BTC for less than 155 days) accept a sale at a loss. Long-term investors barely react.

Overall, long-term investors continue to accumulate BTC despite the decline in the price of BTC. Network indicators show no signs of market highs yet. Most of the sales came from short-term investors. Perhaps the correction will help BTC accumulate for the next rally.

Other information:

US lawmaker Marie Newman announced that she has acquired up to $ 50,000 worth of cryptocurrency through Grayscale Bitcoin Trust shares. Congressman Newman bought between 15,001 and 50,000 GBTC, according to a financial report filed with the US House of Representatives last Wednesday. In addition, between November and December, she made four one-time purchases of Coinbase Global Class A stock valued at $ 215,000.

Florida Governor Ron DeSantis has proposed a program that will allow Florida companies to pay government fees in bitcoin and cryptocurrencies, as well as other cryptocurrency-related proposals that will be included in the government budget for the year. The move is an attempt to attract more bitcoin investment to Florida.

Amazon invested in distributor of sports collectible cards Dibbs. Dibbs runs on the WAX ​​blockchain, which the company uses to generate NFT tokens for its collector tokens for sale on the marketplace. Investing in Dibbs is an indirect way that Amazon invests in the cryptocurrency market.

Microsoft is investing US $ 27 million in crypto startup Palm NFT Studio for Series B. Palm NFT Studio is a Tier 2 Ethereum startup that provides easy development and provision of tranches for large scale NFT cutbacks on the Palm network. allows.

Meta-company WhatsApp has implemented cryptocurrency trading technology right in this app via Novi wallet. This is a wallet from Meta (Facebook).