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Can The Crypto Market Spur A Santa Claus Rally Following December Shivers?

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Can The Crypto Market Spur A Santa Claus Rally Following December Shivers?

Price in bitcoin fell below $7,000 on Monday, dropping roughly 3.5% to a low of $6,828. This marks the second time in the past 30 days the digital asset has closed below that critical support level. 

While bitcoin’s drop is nothing to sneeze at, other cryptocurrencies also saw drastic selloffs during the December 16 trading day. Both ethereum and litecoin fell almost 8% to reach nine-month lows of $129.26 and $39.04, respectively.

Crypto Scammers Play The Grinch

Despite the panicked selling, there was no clear catalyst for the drop.

However, reporting from Coindesk speculates that the massive sell-off may be the result of scammers associated with the PlusToken Ponzi scheme selling huge amounts of their ill-gotten gains.

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The PlusToken scam was broken up in the summer of 2019 and resulted in the arrest of six individuals. Despite the arrests, 20,000 BTC and 790,000 ETH remain unaccounted for. The Coindesk article points to a story published on the Chainalysis blog earlier in the December 16 trading day that posited those missing funds have slowly been redeemed since the action was taken against PlusToken earlier in the year and have contributed to some of the negative pressure the crypto market has seen since the arrests.

This speculation is, in turn, speculated to be behind the current negative price pressure.

Hope For A Trustless Santa

While the sell-off marks another in a series of volatile Decembers for crypto, the drop may mark a strong bottom for the market that has seen heavy selling pressure since hitting year highs over the course of the summer.

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For its part, bitcoin has seen strong support in the $6,000 range. The currency spent much of 2018 bouncing around the $6,500 level following its fall from all-time highs in late 2017.

Ethereum, meanwhile, is also near historical support between $130  and $140, which it maintained through much of February and March of this year.

If the speculation around bad actors exiting their crypto position is to be believed, it may mean the crypto market will have room to breath following six months of heavy selling.

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