Bitcoin Bounces Above $ 39,000 As Binance Limits Crypto Leverage

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Bitcoin briefly broke the $ 39,000 threshold after six straight days of positive trading, rebounding after falling cryptocurrency prices.

Bitcoin price hit $ 39,544 around 2 a.m. BST on July 26, jumping more than 10% from its 24-hour low of $ 33,890. The token had settled around the $ 38,600 mark by 8:30 a.m. BST.

The cryptocurrency had struggled to break above the key $ 30,000 threshold for several days, as bitcoin found new bottom after several major flash crashes earlier this year that saw the coin tumble from its all-time high of 64 $ 829 in April.

Cryptocurrencies like bitcoin have struggled across the board amid growing regulatory scrutiny from exchanges like Binance and a lack of movement to approve broader crypto regulation.

READCrypto Seriously Damages Investors’ ESG Credibility, Says Candriam

The price move comes as Binance Managing Director Changpeng Zhao said the platform has started limiting new users to its exchange to a maximum of 20 times the leverage on positions, with plans to further expand the change.

We didn’t want to make a thing out of it [sic]Zhao said in a July 26 statement on Twitter. In the interest of consumer protection, we will gradually apply it to existing users over the coming weeks.

Binance has been criticized by global regulators for offering regulated products like spot trading and cryptocurrency-related derivatives without proper authorization, including in countries like Italy, UK, Hong Kong, Germany and Japan.

The platform also removed the offering of crypto-esque tokens tied to traditional direct shares of companies such as Apple and Tesla earlier in July.

The crackdown by regulators has reduced appetite for cryptocurrencies, leading to a drop in the volatility of tokens such as bitcoin.

Leading figures in the industry, such as UBS chief executive Ralph Hamers, and Luke Ellis, director of London-based hedge fund manager Man Group, have slammed the industry in recent days for saying cryptocurrencies have no underlying value.

READUBS chief rejects crypto: were very cautious

If you look at cryptocurrencies as a whole, this is a pure trading instrument. There is no inherent value in it. It’s a tulip bulb, Ellis told the Financial Times on July 26, in reference to the Dutch 17th-century financial bubble.

Ellis said Man Group trades cryptocurrencies alongside other markets, stocks and credits, seeing them as things to trade as they go up and down a lot.

About 15% of family offices around the world are exposed to cryptocurrencies, Goldman Sachs said in a July 21 study. Meanwhile, nearly eight in ten institutional investors say digital assets should be included in portfolios, Fidelity found earlier this month.

UBS boss Hamers said earlier this month that the bank [finds] it’s hard to see the core value of some of these investment opportunities.

We believe they are more speculative than an investment opportunity, he added.

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To contact the author of this story with comments or news, email Emily Nicolle

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