Bitcoin’s commiserations persist as it continues to trade low in a 20-day period. Friday’s decline is a continuation of Thursday’s drop of nearly $500 beginning 4:00 UTC. The Cryptocurrency registered a low of $8,587 although it recovered slightly to trade at $8,741 at press time.
The drop is not really much of a surprise, especially considering the activities that have occurred earlier during the month. Weeks back, after trading steadily at around $10,000, it dropped to a four digit figure of $9,000. It is officially on a three-week low trade and is now 37% down from the February 20 high of $11,767.
The drop now brings it to a 50 percent decline from Bitcoin’s all-time high of nearly $20,000 witnessed in December. From there, the coin dropped sharply over a four-month period amid fears of government regulations.
The week following Valentine’s Day was, however, an excellent week for Cryptocurrencies. It saw the market register a high of $518 billion only for the recent shrinkage to see it plummet to $352 billion-a 47% drop from the gains registered in February.
Well, if you look at the numbers from the time the Security Exchange Commission announced the need for digital currency exchanges to register, then you can connect the dots. The rising concerns of regulation have injected fears of future trading restrictions and consequently may have contributed to the massive drops.
The first sign from the announcement by the SEC on Wednesday was an immediate drop in Bitcoin to below $10,000.
The concern with the SEC is that, to investors, many of these trading platforms appear as registered by and regulated by the SEC when they aren’t. Another contributing factor is the fact that they denote themselves as exchanges which is a false impression to investors that they are controlled by the NSE and meet National Security Exchange standards when most of them do not.
Besides, the SEC’s statement was really adding insult to injury especially when you consider the most recent weeks of warrants from the same agency seeking to establish control over the trading platforms and exchanges.
Even as the SEC is continuing to draw lines between the securities and non-securities without naming names, it is obvious-top Cryptocurrencies are on its radar.
The recent drop may also be attributed to a recent peculiar activity with Binance witnessed on Wednesday. There were speculations that the crypto exchange had been hacked. Numerous social media users had reported draining of their balances and other anomalies in the site.
It took Binance CEO’s reassurance that the platform had not been breached-although they had already announced the suspension of all withdrawals. By the end of the day, Binance guaranteed that the irregular trades had been identified and reversed.
These uncertainties have resulted in the drops in cryptocurrency in one way or another. Of course, the most feared are government regulations and questions whether an asset is a security. It is now up to anyone’s interpretation whether security laws should apply to digital coins. Firms have reacted, resulting in attorneys and self-disclosure in trying to extricate themselves from common scams.