BITCOIN has crashed to HALF its value in just one year amid a crackdown on the Wild West cryptocurrency market.The Securities and Exchange Commission warning yesterday of "potentially unlawful online platforms for trading digital assets" sent the digital currency on a tailspin as it...
BITCOIN has crashed to HALF its value in just one year amid a crackdown on the Wild West cryptocurrency market.
The Securities and Exchange Commission warning yesterday of “potentially unlawful online platforms for trading digital assets” sent the digital currency on a tailspin as it continues its downward trajectory.
In an bid to crack down on the increasingly unpredictable cryptocurrency market, SEC warned: “If a platform offers trading of digital assets that are securities and operates as an ‘exchange,’ as defined by the federal securities laws, then the platform must register with the SEC as a national securities exchange or be exempt from registration.”
Bitcoin’s performance yesterday as it crashed by nine per cent to below $10,000 brings it down to less than half of its value a year ago.
Other cryptocurrencies including Ethereum and Litecoin also showed a significant drop in value.
The federal agency said that cryptocurrencies operated on an exchange – and should therefore be regulated like other currencies.
Todd Kornfeld, a financial services attorney at Pepper Hamilton, believes a tightening of regulations could shake up the market.
He told CNN: “Liquidity is important for many holders of tokens, coins and cryptocurrencies, and if this SEC activity reduces access to the existing token, coin and cryptocurrency markets, that could result in increased volatility in the trading and pricing of tokens, coins and cryptocurrencies.”
A number of initial investors have turned their back on the volatile currency, which was invented 2009 but has soared in popularity over the last few years.
Emil Oldenburg, chief technology officer and co-founder of Bitcoin.com sold of all his stock, describing the digital money as “virtually unusable”.
The Swedish tech guru told Breakit: “An investment in bitcoin right now I would say is the most risky investment you can make.
“It is an extremely high risk. I’ve actually sold all my bitcoins recently and switched to bitcoin cash.”
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Cryptocurrency – also called the Wild West currency – is well-known for its unpredictability.
The digital money system uses blockchains to make transactions, and is designed to make transactions super secure.
But their values are volatile, and investors are frequently targeted by hackers to steal their crypto-cash online.
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