Bitcoin Crashes 20% Amid Growing Fears Of Crypto Crackdown
As first discussed last night, the selling in bitcoin and across cryptocurrencies - which began as Asia opened, and appeared to be catalyzed by headlines from South Korea's finance ministry that a cryptocurrency exchange shutdown is still an option...
... accelerated overnight with bitcoin plunging as much as 20% as the prospect of regulatory crackdowns appeared to spread across Asia. Having traded just above $11,000 this morning, the lowest level since late December, and down more than 40% from its all-time high of $20,000 set just a month ago, bitcoin fell 12.3% to $12,130 as at 7:30am ET.
As bitcoin halted a two-day rally, rival cryptocurrencies also plunged, and the losses in bitcoin are largely in line with those seen across the cryptocurrency space. As of writing, Ripple (XRP), stellar lumens (STR) and cardano (ADA) are down at least 25 percent on the day each. Ethereum's ether (ETH) token has shed 18 percent in value in the last 24 hours.
As discussed last night, traders continue to focus largely on South Korea, one of the busiest markets around the globe for cryptocurrencies, where finance minister Kim Dong-yeon said overnight that shutting down cryptocurrency exchanges is still an option, but in what appeared a backtracking from last week's vow to crack down on bitcoin by the Justice Ministry, Kim said that measures first need “serious” discussion among ministries, holding out hope for traders that a crackdown won’t go that far. Kim said there’s irrational speculation and that rational regulation was needed.
“The finance minister made it clear they’re definitely considering banning crypto trading - and it’s probably the third-largest market,” said Neil Wilson, senior market analyst in London for online trading platform ETX Capital. “The news is hitting prices and broader sentiment, and it follows China’s move to shutter mines.”
Meanwhile, according to Bloomberg, China - which first began targeting the industry last year - is escalating its clampdown on cryptocurrency trading, particularly online platforms and mobile apps that offer exchange-like services, although with China no longer a notable player in the crypto space, it is unclear what if any impact further halts of China's already halted exchanges will have, besides just making cryptos that much more attractive of course.