Bitcoin price dropped below $ 54,000, most altcoins fell within 10%. The reason for the continuation of the correction was a new strain of coronavirus in South Africa and a DNS failure in China, which caused a massive disconnection of miners from the pools.
On the morning of November 26, the cryptocurrency market, following oil and stock markets, returned to the “red zone”. Bitcoin dropped to $ 53,800, Ether plunged down to $ 4,000, and BNB plunged below $ 600 again. Other major crypto assets from the top ten leaders in terms of capitalization followed suit: SOL rolled back from $ 212 to $ 185, ADA fell to $ 1.495, XRP fell to $ 0.91, and DOT fell to $ 34. DOGE showed a slight drop to $ 0.1860. The total market capitalization of the cryptocurrency market decreased by 7.6% to $ 2.4 trillion.
The cryptocurrency market reacted to the decline in almost all financial markets. Stock indices fell, as did emerging market currencies and commodity futures other than precious metals futures. Brent oil futures fall within 6%.
Thanksgiving Day was celebrated in the USA on November 25, so the American stock exchanges were closed, and today they have a shorter working day, which promises to open with a fall of 1.5-2%. The index of the Moscow Exchange fell by almost 3%, European and Japanese stock indices also fell by 2-3%. After the emergence of information about a new strain of coronavirus in South Africa, many investors and traders are trying to reduce risks, fearing a new wave of morbidity and new lockdowns.
Disable Chinese mining pools
News from China again became a local factor of pressure on cryptocurrencies. Last night, there were massive shutdowns of ASIC miners tuned to Chinese pools: F2Pool, ViaBTC, BTC.com and others. This was caused by failures in determining domain names, as DNS servers in many countries stopped returning IP addresses of mining pools. Instead, they gave out addresses of social networks, such as Facebook or Twitter, or an “unknown name or service” error. Through the secondary DNS cache, the error spread among providers in most European countries, including Russia.
As a result of the DNS problem, the hash rate of Chinese pools dropped noticeably for several hours, although this had little effect on the overall hash rate of Bitcoin. Soon the reason was found – almost all of these pools are served by Alibaba Cloud – the largest Chinese cloud provider.
After establishing the source of the problem, miners began to move to other pools or directly register IP addresses, so the network hash rate “sank” for a short time. However, the accident served as an additional reason for the sale of bitcoin, and behind it, and other cryptocurrencies. However, China has already ceased to be the center of mining, so you should not expect any dramatic consequences, even if the Chinese pools are closed completely – miners will simply find other alternatives. Difficulties can arise with ASIC miners, where the pool settings are written directly in the firmware, but their share is most likely small.
Recall that last week the bitcoin rate fell below $ 56,000, having lost more than $ 13,000 in a few days from the historical maximum of $ 69,000. After the rebound, the decline continued, as the situation on the markets remains tense. And after the advent of ETFs, bitcoin begins to increasingly correlate with stock market assets and follow the main stock indices.