Bitcoin dropped below $6 000 and dozens of smaller digital tokens tumbled as this month’s selloff in cryptocurrencies showed few signs of letting up.
The largest digital currency fell as much as 6.2% to $5 887 as of 3:07 pm in Hong Kong, the lowest level since June, according to Bloomberg composite pricing.
Ether sank as much as 13%, while all but three of the 100 biggest cryptocurrencies tracked by Coinmarketcap.com recorded declines over the past 24 hours. The total market capitalisation of virtual currencies dropped to $192bn from a peak of about $835bn in January, erasing much of the gains seen during the speculative mania at the end of 2017.
“Most cryptocurrencies have been overvalued for a very long time,” said Samson Mow, chief strategy officer at blockchain developer Blockstream.
“It’s hard to pin this move on any particular factor, but it feels like the opposite of last year when money piled in as people felt FOMO. Now it’s piling out as they sense panic.”
While cryptocurrencies rallied in July on hopes that a Bitcoin-backed exchange-traded fund would attract new investors, US regulators have yet to sign off on multiple proposals for such a product.
The let-down has coincided with growing concern that entrepreneurs who raised crypto-denominated funds via initial coin offerings are now cashing out of holdings such as Ether, the token for the Ethereum blockchain that is a popular platform for crypto projects.
“The big story in the market today is the huge weakness in Ethereum,” Timothy Tam, chief executive officer of CoinFi, a cryptocurrency data analysis company, said in a phone interview. “Bitcoin has held up relatively well versus Ethereum. It’s still quite weak versus the US dollar.”
At the height of Ether’s rally last year, the digital coin comprised 32% of cryptocurrency market capitalisation, coming within striking distance of Bitcoin’s 39%. Ether now makes up about 14%, while Bitcoin accounts for 54% after falling less quickly than its smaller peers, according to Coinmarketcap.com.
“ICOs that have raised a lot of money are really feeling a lot of pain” as their crypto holdings lose value, Tam said.
Ether has tumbled 39% this month, while Bitcoin has dropped about 22%.
It’s unlikely that recent global market turbulence, fuelled by Turkey’s currency crisis, is impacting cryptocurrencies, said James Quinn, head of markets at Kenetic, a blockchain company with investment and advisory businesses.
“Correlations historically have been extremely low between cryptocurrencies and other asset classes,” he said in a phone interview from Hong Kong. “Which is one of the reasons why there is interest in this space and why people want to make an allocation in this space.”
Still, anyone expecting Bitcoin to provide a haven from turbulence in global markets will have been disappointed. The cryptocurrency’s slide against the dollar this month is almost as big as the Turkish lira’s 25% slump.
All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express written permission from LEADERSHIP Nigeria Newspapers. Contact: [email protected]
ENTERTAINMENT18 hours ago
Ras Kimono’s Wife, Efemena, Dies 3 Months After Husband’s Death
POLITICS23 hours ago
Osun: INEC Has Shown It’s Readiness For 2019 – Election Observer
NEWS18 hours ago
Osun Poll: Alteration Of Result Will Lead To Anarchy – Atiku
NEWS14 hours ago
Obaseki Approaches PMB, Seeks official Pardon For Late Ambrose Alli
NEWS20 hours ago
Osinbajo One Of Best Vice Presidents Nigeria Ever Had – Imo Monarch
POLITICS3 hours ago
APC Queries BoT Member For Attending PDP Rally
NEWS21 hours ago
C/River Health Boss To Receive Mandela Pan African Humanitarian Award in Morocco
COVER STORIES5 hours ago
PDP, APC Knock INEC Over Inconclusive Osun Guber Poll