Bitcoin and Ethereum prices continue to plummet, with Bitcoin dropping below $20,000 on Friday. This marks a significant decline for the leading cryptocurrency, which was trading at close to $25,000 earlier this year. Ethereum is also experiencing a similar pattern, with its price dropping by 9.8% in the past 24 hours to reach a two-month low of $1,383.
The wider crypto market has also been affected, with the market capitalization of all cryptocurrencies falling below $1 trillion for the first time since January 19. This is a remarkable change in fortunes for the industry, which started the year with significant gains.
The recent downturn in the crypto market can be attributed to several factors, including the meltdown of the crypto-friendly infrastructure provider, BitMEX. The company was charged by the US Commodity Futures Trading Commission (CFTC) for violating anti-money laundering regulations and failing to implement adequate know-your-customer (KYC) procedures.
In addition, the ongoing COVID-19 pandemic has also contributed to the decline in the crypto market, as investors are becoming increasingly risk-averse. The uncertainty surrounding the global economy has led to a flight to safety, with investors preferring traditional safe-haven assets such as gold and US Treasury bonds.
Despite the recent downturn, some analysts remain optimistic about the long-term prospects of cryptocurrencies. They believe that the current market conditions present an opportunity for investors to buy in at a lower price and reap significant gains in the future.
However, others caution that the crypto market is highly volatile and unpredictable, and investors should exercise caution when investing in cryptocurrencies. As always, it is important to do your research and seek professional advice before making any investment decisions.
