Bitcoin Swings near $8,000 after Twitter Bans Crypto Ads
Bitcoin swung between gains and losses near the $8,000 level after Twitter announced it will start banning cryptocurrency advertisements.
The largest cryptocurrency dropped 2.12% to $7,965.87. The cryptocurrency had earlier surged as much as 4.8%, reversing an overnight decline that took Bitcoin down to about $7,850.
Additionally, Bitcoin remains down 25% in March.
“Today’s news on Twitter’s ban is likely a significant contributor to the steep sell-off,” said Timothy Tam, co-founder of crypto-market intelligence platform CoinFi. “As new retail investors enter cryptocurrency, a large portion of them are trading on raw emotion.”
Other digital currencies had followed Bitcoin’s losses. Ethereum dropped 4.39% to $468.40, and Litecoin fell 4.50% to $142.42.
Ripple plunged 7.67% to $0.58, but Bitcoin Cash rose 0.19% to $921.58. It earlier hit a session low of $879.33.
Twitter Joins Facebook and Google in banning Bitcoin
Twitter will start banning initial coin offerings and token sales advertisements. It joined Facebook and Google in a wider crackdown that aims to protect investors from potential frauds.
The new policy will also ban cryptocurrency exchanges and cryptocurrency wallet services ads. Unless they are public companies listed on certain major stock markets.
“We are committed to ensuring the safety of the Twitter community. As such, we have added a new policy for Twitter Ads relating to cryptocurrency,” a Twitter spokesperson told CNBC. “Under this new policy, the advertisement of Initial Coin Offerings (ICOs) and token sales will be prohibited globally.”
Regardless of the announcement, the main source of worry for the crypto industry on Twitter has been fake accounts. People that are creating fake profiles have been spamming crypto topics with promises of big returns.
Frequently cited were the profiles of Tesla founder Elon Musk, John McAfee, and Ethereum co-founder Vitalik Buterin
Bitcoin has lost more than half its value from a December peak of almost $20,000 as fears of a regulatory crackdown spooked investors.
Facebook and Google bans also brought down the price
The cryptocurrency lost 12% in late January after Facebook said it would ban all ads that promote cryptocurrencies. This was an effort to prevent the spread of “financial products and services frequently associated with misleading or deceptive promotional practices.”
Similarly, Google announced an update to its financial services policy earlier in March. The search engine giant said it will restrict advertising for “cryptocurrencies and related content” starting in June.
Meanwhile, the Twitter news was a “non-event” for cryptocurrency markets, according to Brian Kelly, founder and CEO of BKCM.
“There is not a discernible catalyst on either side of the market so we are just drifting lower,” Kelly said. “The biggest potential short-term catalyst is increased trading in South Korea as the government re-embraces crypto.”