Cryptocurrency Market Drops
The cryptocurrency market is taking a huge hit as its price drops. Monday, after a more than 100% spike over the past month, as regulators and other analysts sound the alarm on bitcoin’s roaring run. But not everybody is confident that the bearishness is justified.
Data provider Reports
According to cryptocurrency market data provider CoinMarketCap, the cryptocurrency market’s size has tanked to around $900 billion from a peak of $1.1 trillion early Sunday morning. Bitcoin, the world’s first and most prominent cryptocurrency, is behind much of the drop, sliding 17% within the last 24 hours, wiping out about $125 billion of market cap. Other top coins are also plunging, down 21%, 16%, and 25%, respectively, with ethereum, XRP, and litecoin.
Also Read: Brian Acton-Founder of Whatsapp and Signal
UK Authorities Statement
The United Kingdom Financial Conduct Authority, which oversees the country’s financials, said on Monday that:
“Consumers should make sure they understand what they are investing in, as with all high-risk investments”
He also gives a stern warning that:
“If consumers invest in these types of products, they should be ready to lose all their money.”
The price plunge began on Sunday after a report by the Sunday Times of the United Kingdom shed light on the compliance steps banks, including HSBC, are taking to prohibit cryptocurrency exchange transactions in the country.
Tim Draper Remarks about Cryptocurrency Market
Before releasing an optimistic prediction that bitcoin values will reach $250,000 by early 2023, venture capitalist and long-time bitcoin advocate Tim Draper railed against the steps, tweeting early Monday that:
“Banks don’t like bitcoin because it makes them less relevant”; bitcoin currently valued at about $32,750.
Anatoly Crachilov, co-founder and CEO of crypto investment manager Nickel Digital, said on Monday, adding that the market is poised for growth as institutional acceptance soars, “Bitcoin often exhibits large upside swings that tend to be followed by corrections, which is normal behavior for a new technology in the early stage of its adoption curve.” “This asset class should only be exposed to professional investors with a long-term perspective on the underlying technology. They also need high-risk tolerance levels and, importantly, never lose sight of the forest for the trees.”
On Friday, Bank of America Securities Chief Investment Strategist Michael Hartnett cautioned that bitcoin looks like “the mother of all bubbles,” adding that “violent” inflation has fueled its nearly 1,000 percent rise since the beginning of 2019, equivalent to the short-lived gold price spikes in the late 1970s and tech stocks in the late 1990s.
The price of bitcoin, first released in January 2009, climbed fifteenfold in 2017 before collapsing 80 percent by the end of 2018. In the middle of a surge of expanded exposure and growing mass popularity, retail trading became simpler across innovative bitcoin sites such as Coinbase brokerage.
Inflation fears and institutional acceptance have fueled mainly the massive rally of the cryptocurrency industry. Investors have been eyeing a bitcoin exchange-traded fund’s regulatory approval. Still, JPMorgan warned on Friday that such a move potentially harms bitcoin values in the short term as investors cash out of the Grayscale Bitcoin Trust, an SEC-approved bitcoin price-tracking fund that many have switched to instead of an ETF.