06 Feb Cryptocurrencies: Panic Selling And Why
Cryptocurrency panic selling is happening more than ever these past few weeks. The slew of adverse reports for the crypto markets created a broader selloff in prices. Analysts’ fears over the price manipulation were vindicated following the Tether and Bitfinex related controversy.
Moreover, regulators all around the globe are stepping up to regulate cryptocurrency trading. As a result of all of this, investors have been losing their confidence in cryptocurrency markets.
Cryptocurrency markets were always expected to swing in prices, but no investor hadn’t expected prices to fall at such a fast pace.
Cryptocurrency panic selling Has Banged the Entire Market:
Source Image: coinmarketcap.com
Prices for bitcoin have plunged more than 60 percent in the last month. It slumped in the range of $7,000 in today’s trade, the lowest level since November 17 (it hit the highest level of $19,000 in December).
The rival cryptocurrencies – Ethereum(ETH), Ripple(XRP), and others – have also been trading at the lowest levels in the previous few months.
Ethereum, which market pundits ranked above the bitcoin, dipped below the support level of $700 today – its price plummeted 16%.
The strong confidence from payments services companies couldn’t save Ripple’s price volatility. Currently trading around $0.69, ripple declined substantially from its all-time high price of $3.67 on Jan 4.
Bitcoin Cash(BTC) and NEO token were among the most prominent laggards in Monday trading. Bitcoin Cash plummeted more than 21%. Meanwhile, NEO price was trading at only $88, highlighting a loss of more than 50% in the past six days alone.
Why Are Prices Falling At Higher than Expected Pace?
Unfortunately, the ban on cryptocurrency and ICO ads from Facebook impacted traders sentiments. Also, the strict regulations from financial institutions have aided the crash. The unforeseen blow from big banks has intensified the problem; J.P. Morgan Chase, Citigroup, and Bank of America said Friday that they will not allow their customers to buy cryptocurrencies with their credit cards.
Regulatory Scrutiny Bad for the Short-term, but Vital for the Long-Term
Regulatory concerns stridently pulled back the prices in the past couple of weeks. Nevertheless, regulating digital currencies would help in bringing institutional and big names into cryptocurrency markets in the long-run. Analysts say, “The more regulators understand the markets, the higher the probability for regulated products, such as ETFs.”
Featured Image: Twitter