After the price of bitcoin hit an all-time high in mid-December, it has raised the expectation of investors to gain high profits. However, recently, it slumped lower and lower since then. The year 2017 was the dream period for investors of digital currency. Owing to bitcoin boom, the value of other digital currency grew gradually. But 2018 turned to be a nightmare for investors. The value of bitcoin was nearly $1,000 at the beginning of 2017 and rose 20 times by the end of the year. The first month of 2018 was marred by slump in the value of bitcoin. Not only bitcoin but also other cryptocurrencies experienced reduction in their values. The value of bitcoin, the most prominent cryptocurrency in the world influences the value of other cryptocurrencies. Though the fall in value of bitcoin may not result in fall in value of other digital currencies every time, but its value has a great significance in the world of digital currency.
Recently, the value of bitcoin dropped to the lowest since November with 16 percent fall, reaching to $5,981 at 8 a.m. London time. In addition, value of other cryptocurrencies such as Ripple, Ether, and Litecoin dropped nearly 16 percent by the same time. The tumble has given another reason for investors to sell with tight regulations in the U.S. looming largely over their heads. Bloomberg reported that two market watchdogs have been planning to appeal to the Congress for imposing regulations on digital currency trading platforms. The chiefs of Securities and Exchange Commission and the Commodity Futures Trading Commission are expected to hold a meeting at a Senate Banking Committee hearing to discuss the future of cryptocurrencies. They will discuss the gaps in the rules of cryptocurrency trading. The rules for trading in exchanges have been governed by states. So the meeting will be held to determine the future course of the cryptocurrencies to avoid illegal trading and heist such as Coincheck.
Commodity Futures Trading Commission Chairman J. Christopher Giancarlo and Securities and Exchange Commission Chairman Jay Clayton will meet to determine the future of the cryptocurrency in the U.S. along with the world with new regulatory scenario.
“The currently applicable regulatory framework for cryptocurrency trading was not designed with trading of the type we are witnessing in mind,” Clayton said in a statement. “As Chairman Giancarlo and I stated recently, we are open to exploring with Congress, as well as with our federal and state colleagues, whether increased federal regulation of cryptocurrency trading platforms is necessary or appropriate.”
It is evident that the market has been under pressure over several probes and updates whirling around various digital currency exchanges. South Korean regulators have been planning to ban cryptocurrency trading in local exchanges. This has affected the value of the cryptocurrency. Moreover, the recent theft of nearly $530 million worth of digital currency at Japanese exchange, Coincheck has added to the woes of investors. Coinmarketcap outlined that the digital currency lost more than $500 billion in its value since early January. There may be more turbulences in the value of bitcoin and other cryptocurrencies. On the other hand, once regulations come into the picture or decision to not regulate digital currencies is taken, there would be stability as investors will take firm steps. In the wake of different speculations and uncertainty, the value of cryptocurrencies is bound to take a plunge.