Coincheck exchange hit by a massive $500 million heist
Bitcoin (BITCOIN on xStation5) retreats from the 23.6% retracement level
The Russian authorities are finalizing the federal law regulating cryptocurrencies
Bitcoin started the week with a resumption of declines after retreating from the 23.6% retracement of the last leg lower. As we are experiencing new lower highs the bears still seem to be the dominant market side. However, the short-term ascending support line may turn out to be the major obstacle on their way down.
The cryptocurrency market thrilled on Friday on the news coming from Japan. The Coincheck exchange was a subject to one of the biggest digital token thefts. More than a $500 million of NEM coins has been stolen by an unknown hacker or group of hackers. The Coincheck company stated that the heist was not an inside job and the coins was stolen from the so-called hot wallet. Hot wallets are devices that are connected to the external network and used to store cryptocurrencies. They are acknowledged as less secure than cold wallets that are offline, hardware devices. The Bitcoin prices tumbled on the reports but managed to recoup its losses during the weekend. Two days after the theft Coincheck announced that it will use its own money to refund stolen coins to its customers.
Bitcoin price tumbled following the reports about Coincheck exchange heist.
Moving on to the technical analysis of the BITCOIN chart one can see that the prices hold firm within descending price channel. The prices retreated after touching a 23.6% retracement level of the last leg lower. If the downward momentum prevails the bears may want to test the closest obstacle in form of lower limit of the short-term ascending support line. It they manage to break below this hurdle a move towards the lower bound of the price channel may be on cards. Looking at the buy side the bulls have to overcome the 8-session moving average that acts as a local resistance level as well as the above mentioned retracement level if they want to resume the upward sequence. The next resistance level lies at the vicinity of $13175 handle and is marked by the 38.2% retracement level of the last downward impulse.
BITCOIN retreats from the 23.6% retracement level of the last leg lower.
Looking at the subject of cryptocurrency regulations it is worth stressing that the Russian government is finalizing the federal law regulating cryptocurrencies and initial coin offerings. The document regulates creation, issuance, storage and circulation of digital currencies. It also provides the first official definitions of cryptocurrency, smart contracts, token, cryptocurrency exchanges and mining. The documents states that the Russians have the legal right to trade cryptocurrencies for other digital assets as well as for the fiat currencies. It also specifies that the documents concerning the release of tokens like investment memorandum or rules for keeping the register of digital transactions must be published no later than 3 days prior to the sales.