The crypto market is plunging at a very fast rate. This signals the return of the old bad days. Digital currencies are experiencing massive declines in their values. Some digital currencies have lost as much as 50 percent of their values over the past week. Unfortunately, no one knows where the bottom lies or when these drastic declines will come to an end.
Even the world’s most dominant digital currency – Bitcoin (BTC) – was caught up in the free fall. A few days ago, Bitcoin (BTC) plunged below the $6k level. Bitcoin (BTC) has been showing a degree of stability around that range for quite some time now. Unluckily, it wasn’t spared by the recent downward trend. Rather, the digital currency incurred further losses as it just broke below the $5k level. No one knows what’s up next for the crypto market, as crypto prices keep falling freely.
Possible Reasons for the Crypto Crash
While the crash in the crypto market cannot be tied to a particular cause, there are three recent events that might have contributed to the crash. Listed below are some of the events that might explain the present crash in the crypto market.
- The Recent Announcement of the SEC
The first event that might have caused the crash is the recent announcement of the Securities and Exchange Commission (SEC). The SEC recently announced that the operators of two ICOs were selling unlicensed securities, which is against the law. Hence, they must pay restitution and fines. This event alone is enough to spook some investors, however, it didn’t come as a surprise to many. Those that paid close attention to the regulatory-verse were expecting this to happen.
- Bitcoin Cash (BCH) Hard Fork
This is another potential explanation for the massive collapse of the crypto market. The Bitcoin Cash hard fork that went wrong last week might be the primary cause of the crash. The fork didn’t go as expected and it resulted in renewed centralization concerns over BCH. This affected the value of Bitcoin Cash (BCH) so badly, and it also affected the entire crypto market.
A lot of traders and analysts have blamed the crash on Bitcoin Cash fork. However, BCH has always been a dysfunctional and dodgy digital currency. Moreover, the crypto verse has witnessed several forks, so it is difficult to hold Bitcoin Cash fork responsible for the crash in the market.
- The Bad News from NVidia
This is another possible cause of the crash in the market. Recently, NVidia reported a sharp decline in the sales of digital currency equipment. This sad news might have spooked digital currency investors and traders. The sharp decline in the sale of digital currency equipment shows that interest in digital currency is diminishing. There are also no signs of it picking up anytime soon. This could explain the recent price trend in the crypto market, as interest in the crypto business is waning out.
Bitcoin (BTC) Price Today – BTC / USD
Bitcoin (BTC) is down by more than 14 percent over the past twenty-four hours. The digital currency is now trading at a low of $4,669 – a price range it hasn’t tested since October last year. The market cap of Bitcoin (BTC) has also dropped to $81.18 billion and its trading volume over the past twenty-four hours is $7.37 billion.