Major Cryptocurrencies Sink Into the Weekend – ThirtyK

Most major cryptocurrencies fell this week despite several pieces of news showing more signs of wider adoption of digital currencies. Investors, however, seemed more focused on news surrounding U.S. dollar-backed token tether (USDT).

Bitcoin (BTC) bounced around the $6,500 mark for most of the week. Friday afternoon it was down 0.2 percent at $6,575.38. Ether (ETH) was down 0.3 percent to $223.23, while Ripple (XRP) was off 3.8 percent to 51 cents. Bitcoin cash (BCH), which rallied for most of last week, was down nearly 1 percent to $511.90 late Friday.

Tone Vays, a cryptocurrency analyst and trader, and former analyst on Wall Street, tells ThirtyK he doesn’t anticipate bitcoin will be able to climb above $7,000 anytime soon, a level it last surpassed in early September. Bitcoin soared over $19,000 last December.

“I’m still expecting that illusive drop to $5,000” as the bear market continues, he says. The digital currencies market as a whole has been trending lower since December, correcting from what many have called an overbought status.

All Eyes on Tether

Alex Mashinsky, a blockchain entrepreneur and founder of Celsius Network, tells ThirtyK he’s closely watching tether, adding that potential issues with the token could pull prices down across the market.

Noble Bank International, a Puerto Rico firm known for offering services to tether, has indicated on its website it used Bank of New York Mellon as its custodian. However, on Monday, Bloomberg reported a source saying BNY Mellon no longer has a banking relationship with Noble. For a bank, losing its custodian could have serious repercussions including reduced liquidity with its accounts and difficulties with liquidation.

A Bitmex report this week said new financial data from Puerto Rico suggest Tether may be diversifying to other banks. Bank deposits in the International Financial Entities (IFE) category, which includes Noble Bank, Bitmex reports, were down 18.4 percent in the quarter to $2.9 billion. That’s despite continued growth in tether. 

“There’s never a dull moment in the cryptosphere,” Mashinsky said. “There could be renewed negative pressure on bitcoin and Ethereum as a result of doubts and issues with tether. Not everything that seems to be stable is stable.” Mashinsky expects to see pressure on the market over the next two to three weeks from news surrounding tether.

He also pointed to recent added pressure on litecoin (LTC) and ripple. “Many [hedge] funds still feel these coins are overvalued,” said Mashinsky, “and the projects have not necessarily delivered on what they promised to stakeholders. Right now, the industry is waiting for some good news to really change the momentum.”