Daily News | Global Markets React to Silvergate Bank Closure, Causing $300 Million in Liquidations in Crypto Sector

2023-03-10, 01:43

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## Crypto Daily Digest: Global Markets React to Silvergate Bank Closure, with Asian Markets Expected to Follow Suit

Good morning, traders! It's been a wild ride, but don't let those losses get you down. We've got a whole new day to conquer, so let's buckle up and blast off into the weekend! 🚀

The US stock market suffered a decline on Thursday, with the S&P 500 dropping to its lowest point since January 19th. This was caused by concerns about potential issues in the banking sector, which led to financial companies in the index falling by over 4%, and the KBW Bank Index, which includes regional lenders, falling by 7.7%. This drop was due to the collapse of Silvergate Capital Corp. and SVB Financial Group's plummet after a stock sale to shore up losses. The fall caused cryptocurrencies to slide, with <a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> experiencing its most significant drop since November. Investors are now waiting for the Fed meeting and the US economy's monthly job report.

The decline in banking shares had an impact on the Asian stock markets, which are also expected to suffer. <a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> fell 8%, and the yen gained the most in a month due to Silvergate's meltdown. However, the US labor market showed signs of improvement, with jobless claims rising to 211,000, ahead of expectations for 195,000. Friday's monthly jobs report is expected to confirm that the US economy is continuing to add jobs at a strong rate.

The closure of Silvergate Bank has had a significant impact on the cryptocurrency market. Silvergate Capital announced that Silvergate Bank would liquidate its assets and shut down operations. This has caused concerns about the future of crypto banking and may make it harder for new investors to enter the market. Other major cryptocurrencies, such as Ether (ETH), also experienced significant price drops.

The sudden decline in cryptocurrencies has caught investors off-guard, leading to soaring long liquidations and causing $300 million in liquidations in the past 24 hours. <a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> traders suffered the most losses at $110 million, and ether liquidations surpassed $70 million.

## Topic of the Day: Is the recent <a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> selloff a sign of trouble or a buying opportunity?

<a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a>, the world's largest cryptocurrency, has experienced a selloff that caused its value to drop as much as 8.8% to around $20,000, its lowest level since mid-January. This decline was triggered by negative sentiment in the digital asset market after two significant events: Silvergate Capital Corp. collapsed, and New York state brought legal action against crypto platform <a href="/uk/price/kucoin-kcs" target="_blank" class="blog_inner_link">KuCoin</a>. The selloff was further exacerbated by a sudden drop in the native token of the <a href="/uk/price/huobi-ht" target="_blank" class="blog_inner_link">Huobi</a> exchange after the New York Attorney General accused <a href="/uk/price/kucoin-kcs" target="_blank" class="blog_inner_link">KuCoin</a> of operating in the state without a license.

The recent events have created a negative backdrop for the cryptocurrency industry, and renewed turmoil has put some investors on edge. The situation has been worsened by losses in the US equities space, which have amplified amid a selloff in the banking sector. The implications of this selloff on the long-term outlook of the crypto industry are mixed.

On the one hand, the negative sentiment surrounding cryptocurrencies may lead to increased regulatory scrutiny, which could potentially limit the industry's growth. Additionally, the recent selloff could undermine investor confidence, leading to reduced investments in the crypto sector.

On the other hand, some market-watchers have noted that recent negative news has not impacted crypto prices as much as they have in the past. <a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> has gained roughly 26% since the start of the year, which is an impressive run, and this rally may signal a growing acceptance of digital assets by institutional investors. Furthermore, the recent selloff may present a buying opportunity for long-term investors who believe in the future of cryptocurrencies.

To sum up, the decline in <a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a>'s value and the unfavorable market sentiment in the digital asset industry could bring about both advantageous and disadvantageous effects on the crypto sector's long-term prospects. While stricter regulation and decreased investor trust may curtail the industry's expansion, the recent upswing in prices and increasing institutional enthusiasm for cryptocurrencies could indicate a more optimistic future for the digital asset market.

## <a href="/uk/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> (BTC) $20045 (-1.56%) - Neutral Outlook

**Overview:**

- ***Closest daily support zone: 19858 - 19379***
- ***Closest daily resistance zone: 20469 - 21128***
- ***Key Level: 19858 (Monthly Close of Dec. 2017)***

<br>![](https://gimg2.gateimg.com/image/article/1678412542Untitled03101.png)
![](https://gimg2.gateimg.com/image/article/1678412563Untitled03102.png)

BTC experienced a significant decline on Thursday, with a loss of up to 7.62% before closing at -6.17%. The selling continued as Asian markets opened, resulting in an additional 2.5% loss. It is expected that this trend will continue until BTC reaches the weekly 61.8% Fibonacci retracement level of 19379, which may provide some relief. The monthly level of 19858 has served as a buffer zone for now. The selloff was triggered by fear stemming from the latest Silvergate development on the fundamental side, as well as technical factors, such as the potential for massive liquidations due to a large number of stop-loss orders in the $21.5K level. On the weekly timeframe, BTC has quickly reached the Fibonacci golden zone, and ideally, traders and investors would see some consolidation within this zone to reposition themselves. However, the worst-case scenario is that BTC would close below the 78.6% Fibonacci level of 18134, which would invalidate the bullish outlook from the previous rally in January.

**Daily Resistance zones**

1. 20469 - 21128
2. 21344 - 21717
3. 21874 - 23233

<br>**Daily Support zones**

1. 19858 - 19379
2. 19253 - 18628
3. 18476 - 17507

<div class="blog-details-info">
<div>Author:** Peter L.**, Gate.io Researcher
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
</div>

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