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Cumberland, the cryptocurrency division of Chicago-based trading company DRW Holdings, reports an increase in Bitcoin bids worth more than $ 4.9 million each.
The dashed lines below show 13 orders of at least 1,000 BTCs each traded in less than an hour, starting after April 2 at midnight.
Document Update: The post-trade analysis of Monday night's price action revealed a series of large bids (> 1,000 BTC per order) over a one-hour period, which appear to be actual buyers compared to forced liquidations. pic.twitter.com/UiuHLoCbPr
– Cumberland (@CumberlandSays) April 4, 2019
Cumberland suggests that the transactions were true buyers, as opposed to simply placed offers. According to Bobby Cho, Global Head of Trading at Cumberland, the bids were executed and economically binding.
On Wednesday, Cumberland noted that the 10% increase in Bitcoin was a first in eight weeks. Cumberland, which started its over-the-counter trading desk in 2014, said,
"We are on the lookout for $ 5,000 (the next even number) and $ 5,500 to $ 5,800 (strong points of resistance that have already triggered several massive up and downtrend sales going up to $ 20,000). "
At the same time, Bloomberg added algorithmic trading to the list of suspects behind the soaring BTC prices when Bitcoin surpassed the resistance level of $ 4,200 on Monday, pushing it to over 4 $ 800 less than an hour and a half.
According to Bloomberg,
"The number of algorithmic traders in crypto has increased over the last seven months, with 17 algo or quantitative funds started since September, according to Crypto Fund Research."
While an influx of algorithmic traders could lead to market manipulation, among other concerns, Travis Kling, founder of the Los Angeles-based IKIGAI Asset Management crypto hedge fund, says that algorithmic trading can limit volatility.
In an interview with Bloomberg, Kling says:
"Humans will let things go worse than machines. [Algo traders] by definition, put a brake on volatility. "
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