Bitcoin dives 11pc amid fears of US clamp

Bitcoin plunged more than 11 percent yesterday, the most in more than seven weeks, just days after reaching a record.

The biggest crypto coin fell 11.34 percent to US$54,082.60 (HK$421,844) last night, after declining as much as 15.1 percent to US$51,707.51 on the Asian day. Ether, the second-largest token, dropped almost 18 percent before paring losses.

Several online reports attributed the plunge to speculation the US Treasury may crack down on money laundering that's carried out through digital assets.

Bitcoin hit a record high of US$64,869 last week ahead of the debut trade for the cryptocurrency exchange Coinbase Global on the Nasdaq exchange Wednesday. Coinbase ended its first trading week on a high note after bullish reviews from Wall Street analysts. And dogecoin, a token created as a joke and which has been boosted by the likes of Elon Musk and Mark Cuban, rallied more than 110 percent Friday before dropping the next day.

Governments are inspecting risks around the sector more closely as the investor base widens.

Turkey's central bank has banned the use of cryptocurrencies as a form of payment from April 30, saying the level of anonymity behind the digital tokens brings the risk of "non-recoverable" losses.

And India will propose a law that bans cryptocurrencies and fines anyone trading or holding such assets, Reuters reported citing sources.

US Federal Reserve Chairman Jerome Powell last week said Bitcoin "is a little bit like gold" in that it's more a vehicle for speculation than making payments.