Bitcoin dropped below $77,000 for the first time in over a month after a record-breaking hack at Binance rattled the cryptocurrency industry and once again raised questions about the safety of customer assets, even at the world's largest digital asset exchange.
Bitcoin fell as much as 3.1% on Friday, touching a low of $76,300, though it recovered slightly during afternoon trading in New York. Other tokens also declined, including some affected by the security breach. Binance's BNB token has fallen about 7% since Wednesday to around $700.
"The overall crypto market was already bearish, which is why the sell-off spread so quickly and broadly," said Jeff Ko, chief analyst at ViaBTC. He added that Binance has the capacity to absorb these losses.
Will Tamplin, a senior analyst at Fairlead Strategies, believes bitcoin could pull back further in the coming days as it "digests this event," though this week's price action "offers an opportunity to add exposure."
But Matt Maley, chief market strategist at Miller Tabak + Co., sees things differently. He said, "The most concerning scenario is that this incident could cause institutional investors to exit this asset class. Their future demand is crucial to the outlook for cryptocurrencies, but if the market is worried about operational security or counterparty risk, they are likely to pull back."
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