Bitcoin (BTC) is facing renewed bearish sentiments as the crypto market grapples with the uncertainty caused by concerns about the viability of digital asset-friendly Silvergate bank. This situation has heightened interest in how the Bitcoin price will react in the coming days.
In a tweet on March 3, a crypto analyst using the Twitter handle StockmoneyL stated that Silvergate liquidity concerns are a “short-term sentiment killer” for Bitcoin.
With the situation putting pressure on Bitcoin’s price, the analyst identified the $21,400 level as the next support position if the first cryptocurrency fails to overcome the $22,800 resistance.
The fallout from the Silvergate bank
The forecast comes after Bitcoin fell sharply in the aftermath of Silvergate, which stated that it was evaluating its ability to continue operations and was in the process of re-evaluating its businesses and strategies.
Silvergate also stated that it experienced a bank run late last year, which resulted in the sale of assets at a loss, lowering its overall capitalization. Given that the lender is a member of the Federal Reserve System, the uncertainty has raised the prospect of a stepped-up regulatory crackdown.
Interestingly, crypto trading expert and analyst Michaal van de Poppe warned that the Silvergate situation mirrors the Mt.Gox hacking incident and that investors should expect further fallout.
“Silvergate crashes yesterday, and markets are down. Within a timespan of 12 hours, we’re talking about Mt. Gox, the worse to happen with Ethereum (ETH) unlocks, Tether to collapse, Big Crisis to happen, and more. Typical crypto,” he said in a tweet on March 3.
Bitcoin price analysis
By press time, Bitcoin was trading at $22,339, representing daily losses of about 4%. On the weekly chart, BTC is down almost 7%.
Bitcoin’s current level comes after the asset dropped by over $1,000 within 60 mins from $23,500 to $22,240.
Bitcoin just dropped $1200 in less than 30 minutes.
— The Wolf Of All Streets (@scottmelker) March 3, 2023
Finally, Bitcoin’s renewed selling pressure has pushed the cryptocurrency’s market cap to hit $431.9 billion.
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