Crypto crunch continues to intensifyBusiness | Bloomberg and Joyce Chen 7 Feb 2018
The rout in cryptocurrencies rolled on, sending bitcoins to its lowest level since October as worries over tighter regulation by US authorities and central bankers elsewhere gave traders fresh reasons to sell after a brutal start to 2018.
The selloff has knocked hundreds of billions of US dollars from digital coins since early January, shaking a nascent market whose core attraction - anonymity and decentralization - is being challenged as never before by regulators.
Bitcoin, the biggest virtual currency, was at US$6,477 (HK$50,391) at midday yesterday in London after earlier sliding to as low as US$5,922, according to Bloomberg composite pricing. Alternative coins Ripple, Ether and Litecoin also tumbled at least 9 percent.
"Crypto is being driven by daily negative news," said Craig Erlam, a market analyst in London at online trading firm Oanda. "There's regulation speculation in India, South Korea and the United States. And then there's hacking."
The slump had fresh momentum after a report that America's two top market watchdogs are planning to ask Congress to consider federal oversight for digital currency trading platforms, many of which have been operating in a regulatory gray zone.
Chiefs of the Commodity Futures Trading Commission and the Securities and Exchange Commission were appearing at a US Senate Banking Committee hearing yesterday to discuss cryptocurrencies.
In Europe, Bank for International Settlements general manager Agustin Carstens said there is a "strong case" for authorities to rein in digital currencies because of their links to the established financial system.
He argued that central banks, finance ministries, tax offices and market regulators should police the "digital frontier."
"The market is feeling regulatory pressure," said Zhou Shuoji, a partner at FBG Capital, a Singapore-based cryptocurrency investment company.