Arab Press

بالشعب و للشعب
Saturday, Jul 05, 2025

Why are Bitcoin and other cryptos nursing losses after hitting highs?

Why are Bitcoin and other cryptos nursing losses after hitting highs?

Bitcoin and other cryptocurrencies have fallen sharply after seeing record-highs just last week.

Bitcoin’s price plunged to $58,400 (€51,000) on Tuesday and hovered just under the $60,000 (€53,000) threshold on Wednesday as the crypto market is again becoming a sea of red.

It marks a 12 per cent drop from the record high of $69,000 (€61,000) set on November 10.

The second-largest crypto Ether meanwhile plunged more than 14 per cent since its record last week to reach $4,244 (€3,7500).

The reasons why cryptos have been so volatile of late is unclear but there are a number of factors at play.

One reason may be due to market manipulation, argues David Gerard, the author of the book Attack of the 50 Foot Blockchain. And it is all to do with Tether, a blockchain-based cryptocurrency whose tokens are backed by an equivalent amount of US dollars.

Tether pumping up prices


"Tethers are supposed to be all backed by dollars. There's a lot of reasons like settlements with the authorities that suggest this has not been the case in the past, and we shouldn't presume it's the case now," Gerard told Euronews Next.

"So it looks like three billion Tethers, backed by nothing, were used to pump the Bitcoin price up at this particular time.

The reasons why cryptos have been so volatile of late is unclear but there are a number of factors at play.


"When they stopped, the Bitcoin price dropped. That's basically the story of the shenanigans that went on in the last week or two".

Gerard argues this kind of market manipulation and fake liquidity happens all the time.

"The basic thing that happened was the Bitcoin price, we know it's highly manipulated because this is an unregulated pool for sharks," he said.

"I think some fake liquidity was deployed. About $3 billion (€2.6 million) worth of questionable liquidity was deployed, which was used to pump the price up.

"That's the sort of manipulation that goes on in the Bitcoin markets all the time," Gerard added.

"Normal people look at this stuff (the crypto market) and think, 'Oh, that's a good market,' but they're the meat, they're the suckers, and the money comes from.

"This is a big boys game. And you'd better be prepared to be eaten alive," Gerard warned.

Stockpiling Bitcoin


The other reason for the crypto price slide is the continued fallout from China’s crackdown on Bitcoin mining, which led to an exodus of miners to the US and Canada.

China’s National Development and Reform Commission said on Tuesday it would continue to regulate crypto mining due to concerns over the amount of energy being used.

Gerard points out it is not just because of mining regulation that crypto prices have slumped. He argues those exiled miners have a billion dollars of Bitcoins that they are keeping as stockpiles and not selling them.

Gerard argues exiled miners have a billion dollars of Bitcoins that they are keeping as stockpiles and not selling them.


"No one can really account for this because Bitcoin miners have never behaved like that, except when they can't sell the coins because there aren't enough people with dollars to buy them.

"I think what's happening there is that all the dumb retail dollars have gone home and the markets are very thin at the moment, and that's why they're having to inflate them in artificial ways," said Gerard.

Cryptos may also have been affected by comments by Twitter’s Chief Financial Officer Ned Segal on Monday. He said investing in crypto “does not make sense right now”.

"We (would) have to change our investment policy and choose to own assets that are more volatile," Segal said.

But the hype around cryptocurrencies and blockchain has not dwindled. On Tuesday, the Staples Center in Los Angeles said it would be renamed the Crypto.com Arena, making it reportedly one of the biggest naming rights deals in history.

Newsletter

Related Articles

Arab Press
0:00
0:00
Close
AI Raises Alarms Over Long-Term Job Security
Russia Formally Recognizes Taliban Government in Afghanistan
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Mediators Edge Closer to Israel-Hamas Ceasefire Agreement
Germany Seeks Taliban Deal to Deport Afghan Migrants
Emirates Airline Expands Market Share with New $20 Million Campaign
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Trump Asserts Readiness for Further Strikes on Iran Amid Nuclear Tensions
Qatar Airways Clears Backlog of Passengers Following Missile Threats
Iran's Parliament Votes to Suspend Cooperation with Nuclear Watchdog
Trump Announces Upcoming US-Iran Meeting Amid Controversial Airstrikes
Trump Moves to Reshape Middle East Following Israel-Iran Conflict
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
“You Have 12 Hours to Flee”: Israeli Threat Campaign Targets Surviving Iranian Officials
Oman Set to Introduce Personal Income Tax, First in Gulf
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
WATCH: Israeli forces show the aftermath of a massive airstrike at Iran's Isfahan nuclear site
We have new information and breaking details to share about what is shaping up to be a historic air campaign tonight
Six Massive Bombs Dropped on Fordow; Trump: 'A Historic Moment for the U.S., Israel, and the World'
Fordow: Deeply Buried Iranian Enrichment Site in U.S.–Israel Crosshairs
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Pakistan to nominate Trump for Nobel Peace Prize.
Israel Confirms Assassination of Quds Force Commander in Tehran
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
G7 Leaders Fail to Reach Consensus on Key Global Issues
Mass exodus in Tehran as millions try to flee following Trump’s evacuation order
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Netanyahu Signals Potential Regime Change in Iran
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
Energy Infrastructure Becomes War Zone in Middle East
Iran Conducts Ballistic Missile Launches Amid Heightened Tensions with Israel
Iran Signals Openness to Nuclear Negotiations Amid Ongoing Regional Tensions
Shock Within Iran’s Leadership: Khamenei’s Failed Plan to Launch 1,000 Missiles Against Israel
UK Deploys Jets to Middle East Amid Rising Tensions
Exiled Iranian Prince Reza Pahlavi Urges Overthrow of Khamenei Regime
Wreck of $17 Billion San José Galleon Identified Off Colombia After 300 Years
Iran Launches Extensive Missile Attack on Israel Following Israeli Strikes on Nuclear Sites
Israel Issues Ultimatum to Iran Over Potential Retaliation and Nuclear Facilities
×