Bitcoin Prices, Market Cap Skydives due to FUDJan 13, 2018 at 13:40
Bitcoin price down below $15,000 and Market cap slashed by $200 billion – what’s driving the FUD?
Many are speculating that the end of cryptocurrency looming after several territories have bared plans to bail out from cryptocurrencies.
Recently, China said it will exit the crypto-mining site. South Korea exchanges, on the other hand, are dropping out of Coinmarketcap.
There are also threats from several governments to clamp crypto-trading, which pulled down the market cap by a total of $200 billion.
But where is cryptocurrency really headed?
Fear, Uncertainty, and Doubt (FUD) has been the fuel that drives cryptocurrency trading. It has crashed several coins before, either intentionally or through unfortunate news.
As investors know that negative news can and will affect market prices, these FUD usually lead to panic selling and massive sell-offs, which leads to massive corrections, driving the price of coins back to before their bullish rallies started.
With the current threats and news, it’s no surprise that the market, as well as bitcoin prices, are taking a dive.
What’s driving the market prices down?
Last January 8, 2018, a notice from the Chinese Finance department surfaced telling cryptocurrency miners to exit the space gradually, until January 10.
It was later clarified that mining will not be banned outright, but rather, preferential policies that are benefiting miners will be cancelled and Bitcoin mining will slowly be tightly regulated.
On the same day, Coinmarketcap—one of the largest resources for cryptocurrency market prices, removed Korean exchanges from its price calculations, leading investors across the globe to see prices dipping from the previous day which further drove massive sell-offs.
The news made Bitcoin prices drop to $14,383 from the same day’s high of $16,461.
Not the first time
Although not as known or heard of as Bitcoin is today, Bitcoin prices had significantly dropped before and as many long-time traders would note, price drops always had resulted in new highs.