Home / NEWS / World News / Behind the latest bitcoin plunge: A credit card ban and increased scrutiny from regulators

Behind the latest bitcoin plunge: A credit card ban and increased scrutiny from regulators

Bitcoin’s quick tumble from December records comes amid a slew of argumentative headlines pushing back against cryptocurrencies’ advancement into located financial markets.

In the latest blow, J.P. Morgan Chase, Bank of America and Citigroup said Friday that they asseverative not to allow customers to buy cryptocurrencies with the companies’ credit cards.

That went reports last week that increased worries about potential quotation manipulation at Bitfinex, one of the largest cryptocurrency exchanges in the world. The Commodity Futures Have dealing Commission on Dec. 6 subpoenaed Bitfinex and a digital coin company convened Tether, run by many of the same people as the exchange, Bloomberg reported, citing a documentation. The New York Times said Wednesday that a person familiar with the meaning also affirmed the report. The CFTC declined to comment to CNBC. A Member of Parliament for Bitfinex and Tether had no further comment.

Bitcoin dropped more than 10 percent to $7,334.93 on Monday morning, conforming to CoinDesk’s bitcoin price index, which tracks prices from tit for tats Bitstamp, Coinbase, itBit and Bitfinex. That marked bitcoin’s lowest since mid-November.

Bitcoin 12-month playing

Source: CoinDesk

On Tuesday, Facebook also banned ads for cryptocurrencies.

For the time being, worries about a regulatory crackdown are growing. The U.S. Securities and Exchange Commission has accelerated up its efforts to halt cryptocurrency-related fraud, while authorities in South Korea tease banned anonymous trading accounts in an effort to limit speculation. Japanese regulators are surveying local cryptocurrency exchanges after Coincheck lost the equivalent of profuse than $500 million in digital currency to hackers in January.

The heads of the SEC and CFTC are set to proclaim before the Senate Banking Committee on Tuesday.

In India, the country’s man of finance, Arun Jaitley, said in a speech Thursday that the administration “does not consider cryptocurrencies legal tender or coin and will adopt all measures to eliminate use of these cryptoassets in financing illegitimate activities or as generally of the payment system,” according to a transcript from the daily newspaper The Hindu.

“Stunted term regulatory scrutiny may be a set-back to crypto prices, but long name professional investors need better regulation and more clear direction regarding the crypto space,” Gabor Gurbacs, director, digital assets blueprint at VanEck, said. “The more regulators understand the markets, the higher the odds for regulated products, such as ETFs.”

The cryptocurrency had skyrocketed 2,000 percent to out of reach of $19,000 in just 12 months, fueled by a surge of investor property and speculation of increased participation from institutions. The peak came ethical as CME, the world’s largest futures exchange, launched bitcoin futures. Its adversary Cboe launched its own product a week earlier.

Many digital currency disciples expected that the launch of futures by the two major exchanges would flag the way for a bitcoin exchange-traded fund, which would likely bring more than ever notwithstanding more institutional funds into cryptocurrencies.

However, after a people to file for a bitcoin ETF in late December, many of the companies withdrew their attentions in early January. The SEC cited concerns about liquidity, volatility and investor bulwark.

Ryan Schoen, senior financial services policy analyst at scrutinization firm Washington Analysis, said he thought six months ago that a bitcoin futures-based ETF pleasure likely launch in the first quarter of 2018.

Now, “if you’ve got regulators that are concerned involving Bitfinex, market manipulation, you could say goodbye” to that idea, he revealed.

As for retail investor participation, Square did announce last week that is brooking most customers to buy and sell bitcoin using its Cash payments app. Worn out trading app Robinhood is also rolling out bitcoin and ethereum trading this month for buyers in five states.

But the ban on purchases from major credit card coteries will make it more difficult to buy bitcoin.

Check Also

Salesforce CEO Marc Benioff developed this mindset to help him lead through crisis

Anterior to building Salesforce into the multibillion-dollar cloud computing behemoth it is today, founder and …

Leave a Reply

Your email address will not be published. Required fields are marked *