Bitcoin cuts: 10 billion yuan in single-day short positions in the entire network.

Reporter: Zheng Yu and Zhang Rongwang report from Beijing

Source: China Business News

In the morning of March 13, Beijing time, the Nikkei 225 index expanded to 7%, and the South Korean KOSPI index fell 6%, triggering a circuit breaker. On the evening of March 12, the three major Dow Jones, Nasdaq, and S & P 500 jumped sharply and plummeted, triggering the third fuse in the history of US stocks, which was only two days apart from the previous fuse. European stock markets fell in weight, the European Stoxx 600 index fell 10%, the largest single-day drop in history. According to incomplete statistics, in addition to the US stock market yesterday, the stock markets of many countries, including the Indonesian stock market, the Brazilian stock market, and the Canadian stock market, also fused.

As the global market plummeted, the price of traditional safe-haven asset gold also fell, and spot gold fell more than 3% in the day. "China Business Daily" reporter noticed that Bitcoin, which has been touted as a safe haven, performed particularly poorly.

According to the cryptocurrency information site Coinmarketcap, on the evening of the 12th, bitcoin price experienced a rare historical decline. It began to dive quickly from around $ 7,200, and fell below $ 5,600 within ten minutes, a drop of more than 20%.

"This time is destined to be recorded in the bitcoin era. The historical one-day drop in history is not the most terrible. According to the statistical report of the contract emperor market, the contract market has sold out a total of $ 117 million in the past hour, of which the amount of open positions The top three are BTC 1.005 billion USD, ETH 145 million USD, and BCH 52.43 million USD. "A speculator said.

Evaporates nearly 20 billion yuan in 24 hours

As of the press release, Bitcoin fell below the $ 4,900 / piece mark, with a drop of 37% in 24 hours and a drop of more than 40% within 7 days, which is almost a cut. Multiple bitcoin trading websites and apps have stuttered. As of March 6, Bitcoin was still above $ 9,000.

The drop in bitcoin price has a direct impact on mining machine manufacturers. At the same time, a number of mining machines, including the Ant S9 series miners owned by Bitmain and Avalon A911 owned by Canaan Technology (CAN), reached the shutdown coin price. Currently, the lowest power consumption of Bitcoin mining machines is less than $ 3,000.

There is no doubt about the impact on the industry's upstream and downstream. At present, the head needs to save strength, and small and medium players are ready for the winter. "The probability of new players entering the market is not high." Cai Kailong, a senior researcher at the Institute of Financial Technology of Renmin University of China, said.

With the collective plunge of crypto assets represented by Bitcoin, the cryptocurrency contract market has also fallen into a dark moment.

According to coin coin data, the entire network ’s short positions in the past 24 hours reached US $ 2.58 billion, equivalent to approximately 18.1 billion yuan. Among them, bitcoin ransom USD 376 million, about 78,400 bitcoins, 2.6 billion yuan.

According to Coinmarketcap statistics, as of March 2020, there are a total of 5,198 cryptocurrencies in the world with a total market value of US $ 150.5 billion, of which bitcoin has a market value of 60%. The highest point in its historical total market capitalization reached $ 828.5 billion in January 2018.

Including Bitcoin, the current top ten mainstream crypto assets by market value, except for stablecoins (a crypto asset anchored with the US dollar 1: 1), have fallen by more than 30%, of which Bitcoin Cash (BCH), etc. The decline has already exceeded 40%.

"(Crypto assets) is currently spreading panic, and this time there may be exchange run risks." An investor who lost more than 100,000 yuan yesterday said pessimistically, "Yesterday, more than 50 people in our WeChat group lost nearly 30 million yuan RMB. "

The official app of Binance Exchange shows that the ERC20 token withdrawal (withdrawal) has been suspended. The plunge in mainstream crypto assets, coupled with Binance Exchange's announcement to suspend withdrawals, has accelerated market panic.

The latest data from shows that the bitcoin panic index has reached 14, which is in a state of extreme panic, hitting a new low of nearly 6 months.

According to the website's definition of the panic index, the panic index consists of six indicators: currency price volatility (25%), market transaction volume (25%), social media popularity (15%), and market research (15%). , Bitcoin's proportion in the entire market (10%), hot word analysis (10%). The current data is 14, which is the lowest level since August 2019, which directly reflects the degree of panic in the crypto market.

As of 8 am on March 13th, Bitcoin, the number one crypto asset market value by 24 hours, had fallen by 38%, and the top ten currencies such as Ethereum and Bitcoin Cash had fallen by more than 40% within 24 hours.

Taking the opportunity to hype?

In the face of the plummeting crypto assets, in addition to the constant "wake up" voice in the currency circle, some people believe that it is time to enter the market. A practitioner told reporters: "Wait for tomorrow's dip."

From the perspective of those who are preparing to enter the market, the price of crypto assets such as Bitcoin has fallen because of the hype.

"Bitcoin's ups and downs are often the result of some joint activities of the bookmakers, and they will use some events in the market to speculate." A currency circle analyst bluntly said. It was also suggested:

"Isn't the currency circle a MLM disk? Why follow the world?"

In a round of Bitcoin's plunge at the end of 2019, some practitioners also told reporters that they are skeptical about whether the news is an important factor affecting the price of Bitcoin.

But this time, the currency circle seems more pessimistic.

Some people in the industry said that the previous market news had the main force in the market, but this time it was really a chain sale.

Cai Kailong believes:

"This plunge is not something the dealer can control, they are also fled in a hurry."

The reporter noticed that some users on Weibo questioned that Bitcoin fluctuated by more than 4% in 1 minute, and was skeptical of high leverage contracts. While another user wrote in a reply, a highly centralized market (crypto asset markets such as Bitcoin), with a bottomless merchant in the center, will always be a long, short and double explosion. High leverage is dead.

"Bitcoin has forgotten its attributes." One person in the currency circle joked. Whether it is a plunge or a hype, Bitcoin's "hedging" attributes have disappeared.

"The global liquidity crisis is coming, and Bitcoin will naturally be prioritised as a risk asset," the aforementioned person told reporters.

Cai Kailong wrote that the emergence of stablecoins has made Bitcoin no longer a clear risk-averse function, but rather a volatile venture capital.

"The important reason for the slump is the spread of panic and large-scale withdrawal of funds." Cai Kailong further explained that the market's surprise response to the Bitcoin slump was due to digital assets being regarded as a safe haven for many years. However, at present, Bitcoin is more in line with the characteristics of alternative assets. Its price fluctuates due to the impact of liquidity, panic is transmitted to the market, and a liquidity crisis occurs.

In Cai Kailong's view, the factors that affect the rise and fall of Bitcoin are becoming more complex. But in the future, everyone will realize that it is not digital gold, but a "magnifier of risk." Its value cannot be anchored. Unlike other asset prices, which are affected by costs and prices, Bitcoin has no normal market value range. As of now, it does not have any convincing valuation basis, more like a swaying boat. Without the anchor, its value fluctuates greatly, and the impact of halving the market and supply and demand on it is far less important than psychological factors.