Crypto newsletter: Bitcoin pulls back as India is set to ban cryptocurrencies

• Bitcoin price failed to stay above $60,000 
• India will propose a law banning cryptocurrencies
• Over $ 1 billion in crypto futures are liquidated

Last week was great again for the cryptocurrency market. Bitcoin was even able to break above 60, 000 USD for the first time, providing an additional boost that the market needed in order to go higher. However the cryptocurrency market came under pressure today on reports that India will propose a law banning cryptocurrencies. The capitalization of all digital assets in circulation currently stands at 1.70 trillion, while an average daily trading volume is registered at $142.8 billion. Bitcoin's market dominance increased to 61.4%. Trading activity continued to increase in February. Crypto exchanges recorded 400 million website visits last month, according to data tracked by The Block Research.

Crypto market recorded elevated activity in February as the price of bitcoin jumped $50,000 for the first time. Source: The Block

India intends to ban on cryptocurrencies

Indian government will propose a law banning cryptocurrencies, fining anyone trading in the country or even holding such digital assets, according to Reuters which cites a senior Indian government official. 'The bill, one of the world's strictest policies against cryptocurrencies, would criminalise possession, issuance, mining, trading and transferring crypto-assets, said the official, who has direct knowledge of the plan,'' Reuters reported. This news came in line with a January government agenda that called for banning private virtual currencies such as bitcoin while building a framework for an official digital currency. According to proposed regulation, holders of cryptocurrencies would have up to six months to liquidate their positions. Officials are confident of getting the bill enacted into law as Prime Minister Narendra Modi's government holds a majority in parliament.

Bitcoin – yesterday price broke above the upper limit of the ascending channel and reached a new all-time high at $61,618. However buyers were unable to uphold momentum and price pulled back. Currently Bitcoin is testing local support at $55,400 which coincides with 50 SMA ( green line) and the lower limit of the above-mentioned channel is located slightly below. If sellers will manage to clear these two obstacles, then way towards support at $50,000 will be left open. On the other hand, if buyers manage to halt declines here, the upward move may be resumed. In such a scenario the next resistance to watch lies at $57,931. Source: xStation5

More than $1 billion worth of open interest was liquidated by crypto exchanges

More than $1 billion derivatives positions were liquidated by crypto exchanges within the last 24-hours, mostly Bitcoin, Ethereum  and Polkadot. According to Bybt.com, crypto exchanges liquidated traders' overleveraged positions who thought that bitcoin's price would continue to move higher. However recent news from India caused declines and bitcoin's price went below the liquidation price of their positions. Therefore exchanges were forced to liquidate or close their positions because traders cannot fulfill margin requirements of their leveraged positions.

The largest single liquidation occurred on Huobi for bitcoin, valued at around $19 million. Source: Bybt.via The Block

Ethereum – buyers failed to break above the upper limit of the triangle formation and price pulled back to the strong support zone around $1731 which is strengthened by lower limit of the aforementioned triangle formation and 200 SMA ( red line). Should a break below  occur, downward move may accelerate towards support at $1475. On the other hand, breaking above the 50 SMA (green line) may invalidate the bearish scenario. In this case, another upward impulse towards the upper limit of the formation could be launched. Source: xStation5