In recent days cryptocurrencies have been taking advantage of uncertainty in other markets. Many people started to talk about the safe-haven opportunity that Bitcoin and many other altcoins could give us. However, the whispers about iEarnBot challenged this position and raised alarm bells.
The ongoing United States banking crisis made the Federal Reserve inject $300 billion into the economy. However, the lack of confidence and the possibility of increased liquidity, leading to high inflation, made people look after trustable and anti-inflation assets. This research caused people to buy cryptocurrencies, one of the main reasons for the price increase. Therefore, crypto is one of the few safe havens from the turmoil reminiscent of the Global Financial Crisis (GFC) of 2008.
This reaction has happened before. In March 2020, during the COVID-19 crisis and market crash, and before that, back in the 2008 crises, we saw the same reactions. After 2020 ultra-dovish policies, the US M2 money supply grew 46% before QT began — and Bitcoin raised to 70K from under $4,000 in just a few months.
While more people have been interested in buying cryptocurrencies recently and have chosen this method of capital preservation, whispers about one of the largest possible crypto scandals to date, challenging the security of cryptocurrencies once again. Many reports show thousands of people probably lost their savings after investing in a cryptocurrency trading app called iEarn Bot. iEarn clients have been told their investment would be handled by the company’s artificial intelligence program, guaranteeing high returns. However, it is now, even several months, that most clients in many countries can not withdraw funds. Many experts after the investigation warn that it could be one of the largest crypto scandals to date.
While not much time has passed since the bankruptcy of the FTX exchange, the iEarn scandal can cause an irreparable blow to the cryptocurrency industry.
From the technical point of view, Bitcoin trades above 25,000 US dollars, and as long as it is above this level, bulls have market control. The next target can be 30,000 if BTC can hold the 27,000 support. On the flip side, and based on fundamental news, breaching under 25K can go much deeper. Under that following targets could be 23K, 19K, and then 16,000 US dollars for now.