Cryptocurrency Regulation Worries Caused Bitcoin Sell-Off
Today Bitcoin dropped more than 7 %, as investors have concern that regulators might clamp down on an asset whose value has skyrocketed in the past year.
On the Luxembourg-based Bitstamp exchange the price of the world’s biggest and best-known cryptocurrency fell to as low as $10,567. The highest price of the session was $11,794.
This week other cryptocurrencies, such as Ethereum and Ripple also dropped sharply after China and South Korea reported about cryptocurrency trading ban. The chief analyst of Alt Design Shuhei Fujise said:
“Cryptocurrencies could be capped in the current quarter ahead of G20 meeting in March, where policymakers could discuss tighter regulations.”
On Tuesday Bitcoin fell 25 % in the session, which is the biggest decline during 4 months. It was far from its December market close of $20,000, when the digital coin had surged about 2,000 % in a year.
Tuesday’s decline followed reports that South Korea‘s finance minister had said banning trading in cryptocurrencies was still an option and that the government plans a set of measures to clamp down on the “irrational” cryptocurrency investment craze.
On Wednesday bitcoin futures were trading at $10,740 on Cboe Global Futures Exchange, with 1,586 contracts having traded. The open demand was 2,895 contracts.
On the Gemini exchange, which is owned and operated by virtual currency entrepreneurs Cameron and Tyler Winklevoss, the futures contracts are based on the auction price of bitcoin in US dollars.
On Wednesday MVIS CryptoCompare Ripple Index dropped 15 % to $7,300. Since the start of the year the equity index has seen a 66 per cent slide in its value. On CoinMarkeCap data Ripple marked $1,15, down from January 4 high of $3.81.