It would seem as it the recent days Bitcoin plunge might well continue. This is at least if you believe a newly published piece in Bloomberg, which looks at the recent market downturn.
Cryptocurrency markets have lost ~$700 billion since January
Those watching the cryptocurrency markets will know that they have experienced heavy losses for the past few days. Toshi Times extensively covered yesterday’s price fall, but it would seem that the markets are now heading down further.
Practically all major coins were in the red yesterday – a trend that would appear to be continuing. Moreover, Bloomberg reports that the cryptocurrency markets as a whole have now lost nearly $700 billion since January’s peak-cryptomania.
The same report also notes that Bitcoin futures trading – which effectively facilitates betting against Bitcoin – has risen massively. This comes following a long period of relative stability within the cryptocurrency world – at least for Bitcoin.
In fact, Bitcoin’s low volatility in the weeks leading up to this most recent price drop had some investors annoyed at the low levels of volatility. It would appear that the past week’s massive price slide will have put low volatility in perspective.
Recent price crash coincided with Bitcoin Cash hard fork
The Bloomberg report also notes that the exact reason for the recent price fall is unclear. However, it brings up Bitcoin Cash’s recent hard fork as a coinciding event, suggesting that this could have been a worrying sign of cryptocurrency ”infighting”.
According to Marc Ostwald, Global Strategist at ADM Investor Services International, the price fall’s dramatic nature may have exacerbated it.
”If you significantly slice through a level like $6,000, people don’t have a lot of protection below it – and then you see a lot of stop-loss selling which exacerbates the move,” he argued. ”It doesn’t help that we have a genuinely risk-averse environment, with equities and credit under pressure.”
Furthermore, the report also raises regulatory sentiment as a concern that could have impacted the price of Bitcoin. It notes the SEC’s recent move against two cryptocurrency companies that failed to register their ICOs as securities.
Moreover, it also highlighted the US Justice Department’s recent investigation into whether 2018’s cryptocurrency rally was caused by manipulation.
”The whole move by the SEC has seemed like a nail in the coffin, and with talk about price-rigging the market, it’s getting nasty,” Ostwald said. He also prepositioned that upcoming Bitcoin futures expirations could adversely affect the market.
Photo by David McBee from Pexels
Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the cryptocurrency industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.