Investing.com – Bitcoin was lower for the fifth consecutive day on Wednesday, a day after the chair of the US Securities and Exchange Commission (SEC) called for more authority to regulate cryptocurrency trading.
Despite being an advocate for the technology underpinning Bitcoin and other cryptocurrencies, Gary Gensler said he wants to make sure the authorities have the power to protect investors.
“This asset class is rife with fraud, scams and abuse in certain applications,” SEC Chair Gensler remarked at the Aspen Security Forum. “We need additional congressional authorities to prevent transactions, products and platforms from falling between regulatory cracks.”
Some analysts believe that further regulation and oversight could actually be a positive factor for Bitcoin and other cryptocurrencies as it legitimises them as an asset class and may pave the way for further institutional investment.
Although Gensler said he wants to protect consumers, which in part may mean the SEC has oversight over cryptocurrency exchanges, Gensler appeared openminded to the idea of a Bitcoin ETF, which could help digital assets continue on their path to becoming a mainstream financial market asset.
Gensler said that he looks forward to the SEC’s review of filings for a Bitcoin ETF, particularly if those are limited to CME-traded Bitcoin futures.
Previously, the SEC has rejected approving a Bitcoin ETF amid concerns of potential market manipulation in the Bitcoin market.
The drop back below $40,000 and the 100-day moving average at around $39,600 could see the door open for a drop towards the 50-day moving average near $34,800. Before that, the $37,500-$38,000 area has acted as support in recent days, while the July 27th low near $36,500 could also be a key support level.
On the upside, the 100-day moving average and psychological $40,000 level will act as resistance before last week’s high around $42,500. A break above that level could bring the 200-day moving average at $44,750 back into play.
Speaking on the latest moves in Bitcoin, OANDA Senior Market Analyst Craig Erlam doesn’t foresee a larger decline.
“I’m not particularly concerned about the run of losses,” Erlam said. “The move feels like nothing more than a cooling off period and I would be surprised if the decline gathers any real momentum.”
“If risk appetite improves into the end of the week, I’d expect Bitcoin to surge once more and perhaps this is what we’re waiting for.”
At 13:17BST, Bitcoin was trading around $38,100, down around 1% in the last 24 hours.
Source: Cryptocurrency - investing.com
