Bitcoin Hits New Lows as Price Crashes Below $5,000
Start of a new week turned out be far from bright for the flagship cryptocurrency, as the gradual slide turned into a free-fall. At approximately 16:30 UTC on Monday, Nov. 19, for the first time in 2018, the price of Bitcoin fell below $5,000 on several exchanges, including Bitstamp and Coinbase.
On Bitstamp, the BTC/USD fell to $4,959 before bouncing back above the $5,000 threshold, while on Coinbase it fell even lower, down to $4,950. This took Bitcoin to a 13-month low with the market cap reducing to just $89 billion.
Things got worse at around 19:15 UTC, when the price of Bitcoin fell below $4900 on both Bitstamp and Coinbase.
At Bitfinex, where BTC has been trading at a $100 – $150 premium for the past several weeks, the price is so far staying above the psychological level of $5,000, however it too seems to be just a matter of time before this support is broken.
Based on the current conditions of the market, a further drop below the $5,000 mark looks rather likely.
The reasons behind such a massive sell-off are not quite clear, with some analysts attributing it to a combination of uncertainty surrounding the recent Bitcoin Cash hard fork and overall bearish technical factors.
However, with the SEC announcing last Friday its first civil penalties against two cryptocurrency companies that didn’t register their initial coin offerings as securities, there are also speculations that the current sell-off was triggered by that ruling. More specifically, Airfox and Paragon Coin Inc. will each have to pay $250,000 in penalties to compensate investors, and will also have to register their digital tokens as securities.
“The selloff is related to enforcement, which is almost certainly underway,” Justin Litchfield, chief technology officer at ProChain Capital, told Bloomberg. “Projects are being made to return investor money, which, after having spent a ton of money marketing their $100 million ICO on a lavish party-filled road-show that was the norm for this vintage of ICOs, will be tough.”
This assertion may be a little overblown, though. Many of the ICOs done have already drained their wallets and likely converted their cryptocurrency into fiat, according to researcher Elementus.
The cryptocurrency industry has now lost more than $660 billion in value from a January peak, according to data from CoinMarketCap. Bitcoin is down more than 70 percent from its December 2017 high, the data show.
Ethereum (ETH/USD) hits the lowest levels since July 2017, falling by more than 10% and slips below $150. Ripple (XRP/USD) is also dragged lower alongside its digital currency peers and but is far from the lows – having weathered the storm relatively well, XRP was trading around $0.49 at the press time.
Other notable losers include Litecoin (-14.19% ; $36.57), Cardano (-15.85% ; $0.052), Monero (-17.79% ; $73.63), Dash (-16.47% ; $111.37), and NEO (-17.65% ; $10.35).
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