Cryptocurrencies have lost $80 billion in market value in one day.
Bitcoin (BTC-USD) is having another rough day on Monday, down by nearly 13% to less than $7,500 — its lowest price since November 2017. Other major cryptocurrencies aren’t doing any better. Many leading “altcoins” such as Ripple and Stellar are down by more than 40% over the past week. While extreme volatility is common in the cryptocurrency markets, if this were happening in the stock market, we would call it a crash.
Today’s cryptocurrency prices
Here’s a look at the 10 largest cryptocurrencies by market capitalization and how much each has changed over the past 24 hours as well as over the past week.
|Cryptocurrency Name (Code)||Price in U.S. Dollars||Day’s Change||1-Week Change|
|Bitcoin Cash (BCH)||$964.00||(16.4%)||(42%)|
As you can see, the cryptocurrency sell-off continues and is widespread. Bitcoin (BTC-USD) isn’t even close to being the worst performer.
Not one of the 10 largest cryptocurrencies is down by less than 10%. For the week, the best performer (Litecoin) is down by “only” 29% while the worst performer, NEM, which was the recent target of the largest cryptocurrency hack ever, is off by nearly 50%. In fact, of the 100 largest cryptocurrencies by market cap, only two are positive on Monday.
Why is the cryptocurrency market crashing?
It’s difficult to pinpoint one specific reason for the sell-off. Rather, a wave of negative cryptocurrency headlines in 2018 seem to have frightened investors, which has led to a rapid and sustained decline in most cryptocurrency prices.
Many of the news headlines have been about regulatory fears. South Korea announced a major crackdown on cryptocurrency trading, particularly on individuals who trade anonymously. China plans to further intensify its crypto crackdown as well. And recently, India’s government issued a harsh statement on cryptocurrencies, vowing to eliminate them from the country’s payment system. These are three key cryptocurrency markets, so regulatory concerns there have been putting major pressure on digital currencies.
Other negative headlines had to do with potential price manipulation, a $600 million cryptocurrency hack, and Facebook‘s ban on cryptocurrency and ICO advertising.
Cryptocurrencies are getting tougher to buy
In addition to regulatory fears, banks are also starting to crack down on cryptocurrency trading, especially when it comes to buying cryptocurrencies with a credit card. This is the latest negative catalyst driving cryptocurrency prices lower.
On Friday, three of the largest credit card issuers in the United States, J.P. Morgan Chase, Bank of America, and Citigroup, all announced that they would no longer let customers buy cryptocurrencies with credit cards. And Monday, Lloyds Banking Group banned its 8 million credit card customers from buying cryptocurrencies as well.
To be clear, from a financial responsibility standpoint, it’s probably a good thing that people will generally not be able to buy cryptocurrencies on credit cards from now on. However, many people were doing it — using a credit card is often the only way to instantly buy bitcoin (BTC-USD) and other cryptocurrencies — so blocking credit card transactions is sure to reduce trading volumes.
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