Bitcoin drops below $11,000, pulls back from key breakthrough level

March 7, 2018

Bitcoin drifted further away from the $12,000 mark on Tuesday, as a popular cryptocurrency exchange faced allegations of insider trading and mishandling the launch of a new asset on its platform.

After a gradual fall Tuesday morning, bitcoin BTCUSD, +0.25% slumped 6.1% to $10,731.51 after hitting a high of $11,432.98 earlier in the day, according to CoinDesk. The No. 1 digital currency was well off a two-week high of $11,660.24 reached Monday, as it faces resistance at the $12,000 level.

Check out: Forget $100,000 bitcoin, says Kenneth Rogoff—try $100 instead

Traders were assessing the news that Coinbase, a popular cryptocurrency exchange, has been slapped with two class-action lawsuits. One suit accuses the exchange’s employees of unfairly profiting from a December listing of bitcoin cash.

Despite the rejection at the $11,500 level, bitcoin remains in the wider $9,000 to $12,000 range — and closer to the top. “I think $11,500 seems like the general market resistance, but either way the overall bull market is in the up-trend phase,” said Charles Hayter, co-founder of CryptoCompare.

He added Tuesday’s slide was “nothing too drastic.”

Illinois exploring tax payments using cryptocurrency

In other news, Illinois is exploring the idea of accepting state tax payments in cryptocurrency. A bill introduced by state Rep. Michael Zalewski reads: “In addition to any other method of payment provided for by law, the Department shall accept payment for any tax imposed by the State and administered by the Department by cryptocurrency.”

Zalewski did not immediately return a call from MarketWatch.

Illinois follows Arizona and Georgia, which have both submitted similar bills to recognize cryptocurrency as a legitimate form of currency for state tax payments.

Elsewhere, bitcoin cash was down 4.2% on Tuesday at $1,212.86, well off a peak above $4,000 seen on Dec. 20; ether was trading at $820.50, down 4%; while Litecoin was down 6.3% at $198.03.

On Monday, Ripple surged more than 7% amid speculation that it could soon be listing on Coinbase. Those gains faded after the exchange said it had no current plans to add additional assets. Ripple moved down 1.8% to 94 cents on Tuesday.

Read: The chance of hacking a bitcoin wallet is as likely as winning Powerball—9 times in a row

Bitcoin futures markets didn’t fare any better, with the Cboe Global Markets March contract XBTH8, +1.07% closing down 7.2% at $10,735, while the CME Group Inc. March contract BTCH8, +1.97% settled down 8.3% at $10,650.

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