[ad_1]
Crypto prices slid on Thursday as investors weighed a news report about two of the biggest institutional liquidity providers dialing back their crypto-trading businesses in the U.S.
Bitcoin fell nearly 3% to $26,937.29, according to Coin Metrics, while ether lost 3.1% to trade at $1,793.82. They’re on pace to end the week down more than 8% and 9%, respectively.
Earlier this week, Bloomberg reported that Jane Street and Jump Crypto, two of the biggest crypto market makers, will take a step back from crypto trading in the U.S. as the country’s regulators continue their crackdown on the nascent industry. CNBC’s “Crypto World” reached out to the firms. Jane Street declined to comment, and Jump did not respond.
“In general, we’re going to see much larger swings in price both ways since so many large market makers have significantly reduced providing,” said David Wells, CEO of Enclave Markets.
“Larger market makers create more stability in prices due to the liquidity they provide,” he added. “You’ll see more frequent gaps up and down since order books are thinner in general.”
Bitcoin (BTC) this week
In late February, the Federal Reserve, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency issued a joint statement warning banks of the liquidity risks associated with banking crypto firms.
The new illiquidity in the market became a bigger theme following the closure of Silvergate and Signature Bank, which operated the two main fiat onramps into the crypto market.
Bitcoin hit the $30,000 level one month ago for the first time since June and has struggled to break higher for longer since then. It’s been floating between that threshold and the upper part of the $26,000 level since then. Investors have been unfazed by the down moves, however.
Chart analysts have been watching $25,200 as a key threshold before worrying about a more meaningful drop down.
[ad_2]
