The value of bitcoin dropped sharply on Wednesday amid a filing for a brand new exchange-traded fund that will bet against the value of the cryptocurrency.
Bitcoin was down nearly 6 p.c at $58,914 per coin Wednesday afternoon — and down greater than 12 p.c from its all-time excessive of simply over $66,900 reached final week.
Ethereum was additionally down greater than 5 p.c from its value 24 hours in the past whereas Binance Coin was down greater than 7 p.c. Cardano was exchanging arms Wednesday greater than 8 p.c decrease.
The value drops got here after Direxion filed for a brand new bitcoin ETF that would bet against the future value of the crypto.
It will probably be known as the Direxion Bitcoin Strategy Bear ETF, in keeping with its filing with the Securities and Exchange Commission.
The software comes only a week after the SEC allowed the first bitcoin futures ETF, the ProfessionalShares Bitcoin Strategy ETF, to start buying and selling.
The approval of that ETF helped ship the value of bitcoin to its newest all-time excessive as analysts mentioned the new ETF would assist broaden investor publicity to cryptocurrencies and make the sector extra mainstream.
The newest crypto value drops additionally got here after commission-free buying and selling app Robinhood reported lackluster earnings that confirmed a significant drop in cryptocurrency buying and selling.
Shares of Robinhood tanked nearly 10 p.c after the Tuesday night third-quarter earnings report confirmed the firm made simply $51 million from crypto trades in the quarter, down nearly 80 p.c from agency’s file $233 million in crypto buying and selling income in the prior quarter.
Robinhood’s surge in crypto income earlier this 12 months was pushed largely by the spike in curiosity in so-called memecoin Dogecoin. Trades of the Elon Musk-favored coin made up greater than 25 p.c of Robinhood’s income in the second quarter.
Robinhood had beforehand warned that it anticipated curiosity in buying and selling to say no in the most up-to-date quarter after the frenzy in GameStop buying and selling earlier this 12 months sucked folks into the inventory market.
The firm had additionally warned buyers that if curiosity in Dogecoin particularly waned, the firm’s operations would be damage.
The value of Dogecoin was down nearly 11 p.c Wednesday morning in contrast with a day earlier.
Bucking the pattern, fellow dog-themed cryptocurrency Shiba Inu Coin soared greater than 18 p.c Wednesday morning over the previous 24 hours. It’s up nearly 700 p.c from a month in the past.