Some traders appear resigned to the fact that further downside may lie ahead.
Bitcoin is struggling to find its way back to positive territory, with prices briefly falling below $40,000 late on Tuesday evening.
With the Crypto Fear & Greed Index now flashing a score of 21 — Extreme Fear — some traders appear resigned to the fact that further downside may lie ahead.
Although Bitcoin’s price did bounce back above $42,000 on Wednesday morning, bulls may face an uphill struggle as they attempt to advance to $43,000 and beyond.
The ongoing woes engulfing the crypto world are linked to Evergrande, a giant Chinese property developer that is drowning under $300 billion worth of debt.
Jitters have spread throughout global markets amid concerns that the company was struggling to keep up with interest payments — but on Wednesday, reports suggested that it had made a deal with some of its debtors.
Details are thin over how wide-reaching this agreement is, meaning it may do little to assuage the fears of investors.
‘People Get Hurt’
Crypto investors were also keeping a close eye on remarks made by U.S. Securities and Exchange Commission chairman Gary Gensler during an interview with The Washington Post — keen for clues on what may lie ahead from a regulatory standpoint.
During the discussion, he likened stablecoins to “poker chips at the casino,” and warned people will get hurt without stronger oversight:
“I think there's just a lot of kind of warning signs and flashing lights that we might have a spill in aisle three, and I'd rather get ahead of it.”
Gensler said that he believes Bitcoin’s whitepaper, authored in 2008, was innovative in some ways — but this has resulted in an asset class that’s highly speculative.
