Despite a rocky weekend, cryptocurrencies are positive to start the week.
Bitcoin (BTC-USD) and most other cryptocurrencies had an extremely volatile weekend. After plunging and approaching the $7,000 price level, bitcoin sharply recovered and is trading for nearly $8,300 on Monday morning, with most other major cryptocurrencies seeing similar rebounds.
Here’s a rundown of today’s cryptocurrency prices, the news item that caused this weekend’s drop, and the comments that triggered the rapid rebound.
Today’s cryptocurrency prices
As I mentioned, most cryptocurrencies are in positive territory on Monday, with all of the top 10 higher. Some popular altcoins, such as Cardano, NEO, and Stellar, are up by double-digit percentages after being some of the worst performers recently. Before we get to the reasons for the recent price action, here’s a quick look at the 10 largest cryptocurrencies by market capitalization, and how much each has changed over the past 24 hours.
|Cryptocurrency Name (Code)||Price in U.S. Dollars||Day’s Change|
|Bitcoin Cash (BCH)||$976.61||8.2%|
Twitter may be set to ban cryptocurrency ads
The initial reason for this weekend’s crypto-sell-off was unconfirmed reports that Twitter is about to implement a ban on cryptocurrency advertising. According to the rumors, the ban will be implemented in about two weeks, and will ban ads for initial coin offerings (ICOs), token sales, and cryptocurrency exchanges and wallets.
This shouldn’t be too much of a surprise, as it would follow similar bans by Facebook and Google in recent weeks. It also comes on the heels of a wave of Twitter impersonation scams, where scammers pose as celebrities in an effort to steal cryptocurrencies from unsuspecting individuals.
With the ICO market largely unregulated and full of scams at this point, it’s not necessarily a bad thing to ban these advertisements. The concern is that it could have a negative effect on the legitimate cryptocurrency world — bitcoin (BTC-USD), Ethereum, and other coins — as falling retail interest could translate into a drop in trading volumes and prices.
Statements from the G20 summit are helping lift prices
The G20 summit is set to take place this week in Buenos Aires, and statements emerged over the weekend that caused cryptocurrency investors to breathe a sigh of relief.
Cryptocurrency regulation has been a reason for much of the volatility we’ve seen so far in 2018, and any clarity on the direction global cryptocurrency regulation might be heading could certainly be a positive catalyst. And that’s exactly what happened.
Mark Carney, Bank of England Governor and chair of the G20 Financial Stability Board, recently published a letter that said that the growing cryptocurrency industry isn’t as much of a threat as it is often made out to be.
“The FSB’s initial assessment is that crypto-assets do not pose risks to global financial stability at this time,” Carney wrote. He also went on to say that cryptocurrencies accounted for less than 1% of global economic output, even at their December 2017 peaks. Finally, Carney’s comments indicate that the FSB doesn’t plan to create new cryptocurrency regulations — rather, it plans to use existing regulations to govern the market.
Both are long-term positive moves
The bottom line is that while some of these news items will cause bumps in the road (like the Twitter news), these are both positive long-term developments. It’s fair to say that the well-publicized abundance of cryptocurrency scams and the resulting lack of public trust is a roadblock to mainstream cryptocurrency adoption, and these ad bans certainly look like a step in the right direction in reducing the effectiveness of such scams.
And while “regulation” is often regarded as a dirty word by cryptocurrency investors, the reality is that lack of clarity on regulation is a big driver of volatility — another major obstacle to mainstream adoption of bitcoin (BTC-USD) and other digital currencies. So, any clarification on future regulations, or lack thereof, are certainly a good thing from a long-term perspective.
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