Assessing EOS agony as Silvergate shutdown leads Block.One to count losses

• The Silvergate Bank situation directly affected EOS’ founding company.
• Price action showed that the token short-term projection could be far from respite.

The native token of the EOS Network [EOS] suffered a great loss in value following the crypto market tumble. Many altcoins experienced the same fate. However, for EOS, the case was not just related to an across-board Bitcoin [BTC] drawdown.

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Sometimes, escape is the way out

While investors scrambled to ensure that losses had only casual consequences, Block.One announced that it held a stake at Silvergate Capital. However, the company which backs the EOS project mentioned that it was exiting its equity position. 

Although it admitted counting its losses, the comment also highlighted that its parent company Bullish was not exposed. The press statement read, 

“While we are disappointed with this outcome, we remain unwavering that banks and other financial institutions embracing the digital asset and cryptocurrency sectors are well-positioned to use technology to advance the capabilities of both the traditional financial services and the new burgeoning digital asset economy to better serve the needs of the public.”

The Silvergate uncoerced liquidation has been one of the major factors that have decreased the overall market capitalization. This extreme development has also spread fear while the market value dipped below $1 trillion.

Ad interim, EOS exchanged hands at $1.04, losing 10.34% of its daily value in the process. CoinMarketCap data also revealed that the token’s market cap had also been affected. 

This implied that the potential upside of the token may be non-existent in the short term. But do the technical indicators share a similar sentiment?

Strains in the pipe

Indications from the daily chart showed that the EOS volatility has been expanding since 16 February. This was the interpretation of the Bollinger Bands (BB) condition. However, the BB widening was the only leak from the chart.

It is also significant to mention that the EOS price action had been hitting the lower and upper bands. As of this writing, the price was positioned around the same proximity as the lower band. This implied that the token had adjusted to a volatility swing in support of an oversold condition.

Realistic or not, here’s EOS’ market cap in BTC’s terms

Concerning the trend-following momentum, the Moving Average Convergence Divergence (MACD) showed that EOS had a weak signal for any entry.

Source: TradingView

In addition, the buyers (blue) and sellers (orange) followed an increasing downward trend. So, this suggests a bearish state alongside the falling price.

In conclusion, the Slivergate episode has had fatal effects on crypto prices. Hence, the widespread impact implied that the ecosystem was not entirely free from the impact of macroeconomic factors.