CryptoWatch: Bitcoin holds above $6,000; Bets against Ether reach record levels

MarketWatch - Financial Services Industry News

Bitcoin prices are holding above $6,000 on Friday after a 24-hour selloff saw the price of the world’s largest digital currency trade perilously close to the crucial support level.

A single bitcoin
BTCUSD, +0.31%
 was last going for $6,249.36, up 0.4% since Thursday at 5 p.m. Eastern Time on the Kraken cryptocurrency exchange.

Thursday’s decline took the total value of all cryptocurrencies below $200 billion for the first time since Sept. 20, according to data from CoinMarketCap.

With global equity markets in the midst of a brutal selloff earlier this week, industry onlookers are watching closely for moves in digital currency prices, with some proponents speculating bitcoin could act as a haven trade—with some calling it “digital gold.”

But Thursday’s move put that notion to bed, for now. “There’s a narrative that the crypto market was simply falling in lockstep with the equity markets, which are slowly entering into correction zones. We believe this move in cryptocurrencies had nothing to do with the stock market,” wrote Thejas Nalval, Element Digital Asset Management portfolio director, and Kevin Lu, the firm’s director of quantitative research.

“Evidence has shown that there have been little correlation between global stock indexes and the price of bitcoin. Nor does bitcoin move on economic data.”

Read: Dr. Doom says bitcoin represents the ‘mother of all bubbles’

Ether shorts reach record highs

Traders are betting against Ether, the second-largest digital currency, at a record pace. Data from the Bitfinex exchange shows there are now more than 300 thousand outstanding Ether shorts, which at current market price is nearly $60 million worth of short interest.

Ether shorts courtesy of TradingView

The popular cryptocurrency that is used to finance crypto-related operations on the ethereum blockchain has been under pressure for the best part of 12 months. After surging to a record high above $1,400 on Jan. 13, the price of Ether has plummeted nearly 90% as the ethereum blockchain struggles with efficiency issues.

In Friday trading Ether
ETHUSD, -0.50%
 was the worst performing altcoin—coins other than bitcoin—down 0.6% at $196.31. Elsewhere, Bitcoin Cash
BCHUSD, +0.25%
 was up 0.3% to $442.50, Litecoin
LTCUSD, +2.02%
 was trading 2.2% higher at $53.02 and XRP
XRPUSD, +6.49%
is the best performing major altcoin, trading up 6.6% at 43 cents.

Bitcoin futures are trying to end the week on a positive note. The Cboe Global Markets October contract
XBTV8, +0.77%
was up 0.9% at $6,200 and the CME Group October contract
BTCV8, +0.16%
 was up 0.3% at $6,200.

Read: Bitcoin whales aren’t responsible for volatility, research firm finds

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