This video is a short update on the crypto market if youve been following the channel. Youll know that i posted a couple of videos recently talking about the crash in crypto currencies and in the last video bitcoin was sitting just above the magical 20 000 mark. Now, as you might be aware, the cryptocurrency markets never close. They are open. 24. 7. 365 days a year, so through the weekend, the bitcoin price has continued to come down and has now gone below the 20 000 mark and actually has carried on beyond that and has now dropped below 19 000. And this is the first time since the end of 2020 that bitcoin has been down at this level and the other main cryptocurrency ethereum has also gone through its floor level. Its now dropped below one thousand dollars so were seeing these cryptocurrencies falling to new levels, and i wanted to talk about a few things in this video. Firstly, ive got three questions that id like to run through with you as to why these cryptocurrencies are tumbling so badly and, secondly, ive got a table which shows some listed companies in new york that have large bitcoin holdings, and one of those is tesla. So well have a look at whats going on with those holdings and obviously if these cryptocurrencies keep falling its going to have a negative impact on those listed companies and so theres a potential that that will have an impact on the share prices for those businesses.

Now, as i said, the crypto markets never close so as soon as i make this video its going to be out of date in terms of the current price. But right now bitcoin is sitting at around eighteen thousand, eight hundred and fifty dollars, which represents a fall of around eight percent today, sixteen percent over the last five days and more than 36 over the last two weeks. So this is absolutely the definition of a crash. Now the key questions here are: why is this happening and when will it stop? Where is the bottom for this market in terms of why this is happening? Weve seen a major sell off in a lot of financial markets over the last two weeks, the news from the fed that they are now laser focused on getting down the inflation rate in the us and that they will keep increasing interest rates in order to get There has sent shock waves through the markets. We saw a 75 basis point hike in the us this week, and that was the largest increase that weve seen for almost 30 years and at times like this, any assets that require future growth in the economy start to look less attractive and cryptocurrency is very much In that bracket, so weve seen a big sell off in crypto, but i dont think anybody expected to see the rate of sell off that weve seen and the falls in the prices that have happened over the last couple of weeks now in terms of wheres.

The bottom of this market, there are some very worrying indicators for cryptocurrency right now. A lot of investors work on algorithms and charts, and one of the metrics that they keep an eye on is the 200 week moving average. So this looks at what the average price of bitcoin is over the last 200 weeks and that average is currently tracking at 19 804. So bitcoin has now breached that 200 week moving average and that could now trigger a sell signal for all of those funds and investors who follow that moving average. In addition to that, its been reported that a lot of institutional funds have been gearing up their position on bitcoin and that twenty thousand dollar price was actually the trigger point to sell for them to start exiting all of those positions. So the fact that weve just moved through that position over the course of the weekend could mean that we start to see mass selloffs from the institutional side over the course of the next week or so. And finally, the third factor here is the hedge funds. As youll know, if you watch the recent video that i posted hedge funds have been set up to make money, whether a market is rising or falling, so they dont just have to buy into positions and wait for it to increase in value if they think the Value of an asset is going to fall, then they can short that market and bitcoin is something that can be shorted.

So we dont have any data just yet, but there is a possibility that the hedge funds have seen this price starting to come down and that theyve been shorting the market and as theyve done, that that drives the price down further. And when you get a situation like that, its really difficult to stop that momentum. Now i dont have any data at the moment to prove thats happening. But i do know that there are a lot of funds who are interested in cryptocurrency and if the price of cryptocurrency is going down, you can bet that a lot of those funds are looking into ways that they can make money from a falling market. This table shows the reported bitcoin holdings for 14 listed companies and the bitcoin valuation that this refers to is around 21 000, which is about 10 higher than where the market is right now now. Obviously, the most interesting company on this list is tesla. Elon musk is famously a big supporter of bitcoin and purchased 1.5 billion dollars worth of bitcoin in 2021. Now for a while that looked like a genius move and tesla was actually sitting on a profit of more than 500 million dollars. However, over the last six months, the crypto markets have fallen and the position for tesla has started to turn sour, and you can see here that the original investment of 1.5 billion was worth around 900 million and at todays valuation. That holding is now worth closer to 800 million, so tesla is now looking at an exchange loss of around 700 million dollars on this trade.

And if we look at the other companies on this list, we can see that at the time that it was produced. Four of the companies were sitting in a lost position, with micro strategy sitting with a whopping 2.7 billion dollar loss. However, as i mentioned, the current price is around 10 lower than it was when this table was produced. So all of these companies are now looking at significantly worse positions than they were here. So what were seeing in the crypto markets right now is a supercharged version of whats happening in the other financial markets were seeing the markets coming off and were seeing daily losses, but because the crypto markets never close, they are constantly falling right now and they are Falling at an accelerated rate and itll be really interesting to see what happens, because if the hedge funds have locked onto crypto as something that they can start making profit from whilst its falling, then we could see that market really starting to tumble over the next week Or so now, when you have a situation like this in the stock markets, if you have one particular share that suddenly starts to tumble the key investors, all rally together and usually theres some form of plan put together, but with bitcoin we dont have key investors, its A disparate group, the whole point about bitcoin and crypto is that its not controlled by one company or any one individual, so weve got a really wide variety of holders and the problem youve got when a market is dropping so fast is that people start to lose Confidence then everybody wants to get out before its too late, and that is potentially a situation that we could be looking at for crypto weve already seen a couple of the platforms suspending withdrawals, and it could be that we see a lot of other wallets being closed Over the next few days, so its going to be a really interesting week for the crypto markets.

So i wanted to post this video really to make sure that youre fully aware that the markets are still moving and theyre still moving down and theyve gone through. A couple of trigger points that i think are sending warning signals to all holders and itll be fascinating to see what happens over the course of the next few days ill. Keep you posted on any exciting news and developments thanks for watching this video. Please give me a thumbs up and dont forget to subscribe.

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