In the preview of the opening of CME futures, Ethereum’s market took a downward turn
ETH’s price plunged 10% in a sudden drop in the market. At the time of this writing, ETH’s price was $ 1,513. The downward trend started at 1:14 pm, when Ethereum was worth $ 1,626. Since then the market has started to sink and has not yet recovered. The Ethereum crash comes a day before the Chicago Mercantile Exchange (CME) launches ETH’s futures.
CME futures are believed to bring a lot of money to Ethereum, as it comprises a regulated and efficient way for institutional investors to speculate on the currency’s future price.
It may also be the case that traders are leaving their positions before listing; CME’s ETH futures contracts make it much easier for institutional investors to sell ETH – in other words, to bet against it.
CME launched Bitcoin futures on December 17, 2017, the day after Bitcoin reached its highest price for that bull run, at $ 19,015. After that, Bitcoin’s price fell downhill, marking the end of the bull run. That said, the 2021 cryptocurrency market doesn’t look much like 2017 – the days of fraudulent ICOs are over (hopefully).
“A new $ 1,550 test should already take place, with or without CME,” a trader told Decrypt.
The fall of Ethereum coincides with a general fall in the market. Bitcoin fell 7% in the last 24 hours to $ 37,547, XRP fell 10% to $ 0.39 and Polkadot fell 8% to $ 18.7.
Other cryptocurrencies remained strong. Cardano (ADA) trades at $ 0.58, up 8% on the day. Dogecoin, the meme currency driven by Elon Musk, Snoop Dogg and Gene Simmons, rose 35% the day before and 116% last week.
Of course, the crash could be as simple as a market correction. The Ethereum price reached a historic high of $ 1,756 on February 5, two days ago, and reached similar prices yesterday.
When cryptocurrencies reach a new peak, they usually retrace their steps in the following days. Bitcoin, which hit $ 42,000 last month, fell to a low of $ 31,500 at the end of the month. These drops can occur because a certain price causes many traders to sell their positions in the market; eviction causes a drop in prices.
Some traders see opportunity in the downturn, hoping the market will recover. “I feel like I need to dive,” another trader told Decrypt. “I have postponed this decision ‘for a better time’.”