Market Wrap: Bitcoin Drops Ahead of Looming ‘Death Cross’ – CoinDesk

Bitcoin declined about 5% over the past 24-hours as the price broke below $36,000 support. The world’s largest cryptocurrency by market capitalization is still up about 23% year-to-date, although some traders are concerned about the looming ‘death cross,’ which could indicate a shift from a bullish to bearish price trend.

The death-cross is defined by a cross of the 50-day moving average below the 200-day moving average, which could occur over the weekend.

Still, some analysts remain bullish on bitcoin relative to equities.

“When the equity tide pulls back someday, we expect bitcoin and gold to be the primary beneficiaries,” wrote Mike McGlone, commodity strategist at Bloomberg Intelligence in a Friday report.

“The recent stabilization just isn’t sufficient to suggest buying dips,” wrote Mark Newton, founder of Newton Advisors, in an email to CoinDesk.

Newton’s cycle work points to continued weakness this year. “For those who are aggressive traders, any break of 30k should lead down to 20-25k and that should be a better area to consider buying dips for a bounce,” Newton wrote.

And for ether, Newton expects a volatile decline over the next one or two weeks given the break below prior lows. 

Bitcoin has been weighed down by ongoing regulatory uncertainty and environmental concerns. 

On Thursday, miners in Ya’an, one of the major crypto mining hubs in China’s Sichuan province, received an inspection notice that required shut-downs. 

And on Friday, Wu Blockhcain reported that Alibaba Cloud, China’s largest cloud service provider, made calls to cryptocurrency and mining companies registered in China regarding potential domain name cancellations due to regulatory requirements.

“This has little impact on the exchanges, because their servers and registered locations are outside of China, but mining companies may need to do some replacements,” Wu Blockchain tweeted. 

Despite regulatory hurdles, institutional demand for crypto remains strong, which could force countries to compete for crypto related businesses. 

For example, on Friday, Spanish banking giant BBVA is making its cryptocurrency trading and custody service available to private banking clients in Switzerland from June 21.

BBVA said the reason why the service will only be available to clients in Switzerland is due to clear regulations and the widespread adoption of digital assets in the region.

The chart below shows the one-month correlation between the top 10 crypto assets by market cap has greatly increased since mid-May, according to data from Skew. This reflects broad selling pressure from the sharp correction in May across cryptocurrencies.

One month after Tesla CEO Elon Musk tweeted his concerns about the potential environmental harm from bitcoin mining, some industry players are rushing to respond. They’re looking at ways to address the environmental, social and governance (ESG) issues that might deter big institutional investors from embracing bitcoin. 

Crypto.com, an app for trading cryptocurrencies, set a goal for the next 18 months of becoming “carbon negative.” Asset management firm One River Digital filed for a bitcoin exchange-traded fund (ETF) that would be carbon neutral. Digital asset investment firm CoinShares made a strategic investment in Viridi Funds and said it would advise the manager on “the first ESG crypto mining product in the U.S.”  Wrapped, a collaboration between tokenization specialist Tokensoft and digital-asset custodian Anchorage, announced a “carbon-neutral bitcoin-backed-asset” called Eco BTC (eBTC). 

“They are doing it out of the sense of survival,” said John Reed Stark, a former chief of the U.S. Securities and Exchange Commission’s Office of Internet Enforcement who now works as a consultant. 

All digital assets on the CoinDesk 20 were lower on Thursday. 

Notable losers as of 21:00 UTC (4:00 p.m. ET):