MATIC is currently facing increased uncertainty as it has been officially classified as a security by the US Securities and Exchange Commission, as revealed in the recent filing against Binance.

Consequently, the Polygon blockchain token experienced a significant drop of 31% within a week, setting a new record. However, there is some positive news as it has managed to recover, witnessing a promising rebound of over 11% in the last 24 hours.

Source: Coingecko

L2 coins will be the next bullrun coins. Already knew, already confirmed.$SOL $ADA $MATIC and others L1’s got the security stamp. Regulation will kick hard = tight choice of L1/L2 coins. Where will all this money flow to? pic.twitter.com/jw5xpLRA4j

— Zoomer Oracle (@ZoomerOracle) June 5, 2023

MATIC is one of the 13 tokens within the Binance lawsuit to be designated as a security. Polygon Labs, the developer of MATIC, issued a statement on Twitter defending Polygon saying that the network is “developed outside the US, deployed outside the US, and focused to this day on the global community that supports the network.”

This recent lawsuit against Binance was followed up by the SEC’s lawsuit against Coinbase, citing that the company is operating an unregistered exchange in connection with the company’s staking service.

Fear, Uncertainty And Doubt In The Market

With the recent classification of several cryptocurrencies as securities, the market has slid considerably within the past week. Bitcoin, the top cryptocurrency, gained dominance in light of the recent regulatory fillings against Binance and Coinbase.

The other tokens in the list are SOL, ADA, FIL, ATOM, SAND, MANA, ALGO, and COTI. According to the lawsuit, the tokens are listed as investment contracts. This made the SEC label them as securities in accordance with the Howey Test, which is a test to know whether a certain asset is a security or not.

MATIC market cap at $5.8 billion. Chart: TradingView.com

This move by the SEC was in line with its recent actions against the crypto industry. Just this February, the regulatory body cracked down on Kraken’s staking service along with forcing the company to pay $30 million in penalties for the violations.

If the mentioned tokens and companies fail to comply with the SEC, it may lead to another Ripple-like event which will affect the market.

MATIC Bulls Should Watch This Level

At the time of writing, MATIC is being supported at the $0.6 price level which will act as the launch pad for future bullishness. However, external market forces still hold sway in the token’s momentum and price actions in the near future. The recent lawsuits already slashed millions upon millions of possible gains for investors.

Source: Coinglass

Meanwhile, CoinGlass data shows MATIC long positions being liquidated as the market crashed after the lawsuits were made public.

Despite this, buying pressure after the crash continued with MATIC bulls holding $0.6 support. If they can hold on to this support level, we might be able to see a return towards the $0.83 support in the medium to long term.

Featured image from The Daily Hodl

Bitcoin (BTC) challenged three-month lows into June 10 as altcoins in particular felt the heat from United States regulatory pressure.

Altcoin bloodbath as exchanges reshape landscape

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD hitting $25,483 on the day, down over $1,200 from the previous day’s high.

While showing weakness, Bitcoin was spared the fate of major altcoins, which reacted strongly to delisting that accompanied U.S. legal action against major exchanges.

Trading app Robinhood announced that it would remove support for several cryptocurrencies named in the lawsuit against Binance and Coinbase by the U.S. Securities and Exchange Commission (SEC).

These subsequently hemorrhaged value, with both Cardano (ADA) and Solana (SOL) down nearly 25% in 24 hours at the time of writing.

“We regularly review the crypto we offer on Robinhood,” the firm stated on its website.

“Based on our latest review, we’ve decided to end support for Cardano (ADA), Polygon (MATIC), and Solana (SOL) on June 27th, 2023 at 6:59 PM ET.”

“As expected, following this week’s action on the regulatory front, we saw some delistings causing market selloff,” Kris Marszalek, CEO of Crypto.com, responded.

“I guess we are in the ‘then they fight you’ stage on the crypto adoption curve. Make no mistake: crypto industry will go through this and emerge stronger than ever.”

Crypto.com confirmed that it would halt its U.S. institutional trading service beginning June 21.

BTC price 200-week trend line support fails

The events had a major impact on the overall cryptocurrency market cap, with Michaël van de Poppe, founder and CEO of trading firm Eight, warning that worse may be to come.

Related: Bitcoin, Ethereum to shake off ‘toothless adversary’ SEC as FOMC looms

As with BTC/USD, should the total crypto cap tally lose its 200-week moving average (MA), this would constitute a clear bear signal. Bitcoin’s moving average trend line currently stands at near $26,400.

“This is not the weekly candle you’d want to see on the total market capitalization for Crypto,” he told Twitter followers alongside a chart.

“Losing the 200-Week MA shouts for downwards continuation on the trend.”

Van de Poppe, like some other popular traders, nonetheless revealed interest in altcoin buys at lower prices.

Accompanying him was Crypto Tony, who predicted “incredible entries” on the table for 2023.

These #Altcoin drops get me way too excited in Crypto as they really do not come by that often

Got some incredible entries lined up later this year. I will share a few later today with you all and they are super realistic .. WHO IS READY

— Crypto Tony (@CryptoTony__) June 10, 2023

For existing traders, however, the damage was done — long liquidations totaled $320 million for June 10, according to data from CoinGlass, with the day not yet over.

Another $70 million in short positions also evaporated.

Magazine: Home loans using crypto as collateral: Do the risks outweigh the reward?

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.