Bitcoin Plunges Below $41k Amid Cries of Matrixport Manipulation

BySamson Ononeme

Jan 3, 2024

Key Insights

  • Bitcoin sees massive outflows and price crash below $42K
  • Sell-off follows Matrixport’s U-turn on imminent spot ETF approval forecasts
  • Critics accuse firm of deliberately undermining sentiment for profit

HONG KONG – Bitcoin crashed through key support levels on Wednesday, shedding over $3,000 in hours amid accusations that crypto financial firm Matrixport deliberately sowed spot ETF approval doubts to undermine sentiment on the 15th anniversary of the blockchain’s birth.

Before recovering, the flagship cryptocurrency, which hit all-time highs of nearly $69,000 in late 2021, plunged below $41,000 during Asian hours trading – erasing the lion’s share of gains over the preceding month.

Bitcoin Plunges Below $41k Amid Cries of Matrixport Manipulation
Source: Coinmarketcap

The flash crash came as Matrixport, founded by Chinese billionaire Jihan Wu, retracted 2021 predictions that U.S. regulators would potentially approve long-awaited spot Bitcoin exchange-traded funds (ETFs) this month.

Widely tipped decisions had sparked enthusiasm for fresh mainstream investment inflows turbocharging further Bitcoin price rises. But Matrixport suddenly backtracked just a day after forecasting January approvals were not just likely, but could land even earlier than industry expectations of Jan. 8-10.

Matrixport scrapped near-term spot ETF predictions without plausible explanations

No rationale was given for the snap reversal, with the startup now claiming spot ETF rejections in January were assured instead. It said approvals were unlikely before the second quarter – without citing sources.

Crypto social media erupted with accusations that Matrixport deliberately undercut sentiment to profit from Bitcoin derivatives trades via its lending arm. Critics highlighted founder Wu’s previous links to Bitcoin offshoot Bitcoin Cash.

“If anyone believes anything Matrixport publishes, I have a bridge to sell you,” said analyst James Van Straten via Twitter, later acquired by CEO Elon Musk and renamed X.

Other ETF analysts said they had conversely heard nothing to suggest U.S. Securities and Exchange Commission rejections this month. Approvals remain widely forecast given stepped up cryptocurrency oversight and mounting institutional investment pressure.

Bitcoin traded around $42,500 at 0230 GMT, nursing losses following one of the largest sudden downswings since last summer. While retail traders girded for further near-term volatility, longer-term bulls argue such speculative market timing efforts rarely impact enduring blockchain adoption.

Samson Ononeme

Meet Samson Ononeme, a dynamic writer, editor, and CEO of With a passion for words and a sharp business acumen, Samson captivates readers with captivating storytelling and delivers insightful market analysis. He is a trailblazer in the finance industry, empowering individuals with knowledge and shaping the narrative of money. Get ready to be inspired by his literary prowess and entrepreneurial leadership.

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