Bitcoin has dropped approximately $800 over the past week, and many are starting to wonder if the currency has lost its momentum.
Could Bitcoin Be Manipulated Again?
For the past several days, bitcoin has been trading below the $10,000 range. It’s unclear, specifically, what could be causing the currency to lose its footing. Perhaps fears of the coronavirus are settling down. Perhaps the cryptocurrency has lost some popularity. In any case, Changpeng Zhao – the CEO of Binance in Malta – states that exchanges have been known to explore manipulation tactics for assisting bitcoin in the past and are likely to start doing so again if things don’t improve soon.
Malta is the largest and one of the most popular crypto trading platforms across the globe. Zhao explains that in the past, in order to assist in the success of both Binance Coin (BNB) and bitcoin, units of BNB have been burned away as a means of ensuring that the exchange’s native coin remains rare enough that it can sustain people’s interest and stay in demand.
By doing this, the currency’s price can remain constant, and in fact, the tactic has helped bitcoin become stronger as well. A Binance burn is likely to take place every quarter, he explains.
This shouldn’t come as a shock to anyone considering how many major attempts have been made in the past to manipulate bitcoin’s future. In 2018, for example, a report was released by Texas-based university professor John Griffin that alleges bitcoin was largely manipulated by Tether users in 2017, the year of bitcoin’s major haul and the period in which it reached its all-time high of nearly $20,000.
In the report, Griffin writes that Tether owners repeatedly purchased bitcoin with Tether every time its price fell as a means of giving it necessary strength to stay above specific support lines. Tether is an alleged stable currency, meaning it is tied to the U.S. dollar. By using it to buy BTC, the world’s primary cryptocurrency by market cap also becomes hinged to the dollar, ensuring its price remains constant.
Last year, bitcoin could not satisfy a $16,000 price prediction that one Twitter user stated would be reached by the end of October. While bitcoin did incur a price hike during that time, it only jumped into the high $8,000 range. It rose to just over $9,000 before it began falling towards its year-end price of about $7,300.
Doing “One’s Part”
Zhao fully admits he tried hard to ensure that bitcoin could sustain momentum during this time. He tried hard to pump hope into Binance users and the crypto community in general, writing in a tweet:
LOL, price predictions are easy. It’s just hard to be right about the timing. We will see $16k soon-ish. 1.4 billion people are working on it as we speak.