Cryptocurrencies Suffered Serious Losses Across the Board
Last month regulatory concerns affected the cryptocurrency market, and cryptocurrencies plummeted again on Tuesday. The Department of Justice (DOJ) said it confiscated $2.3 million in bitcoin as part of the investigation into a ransomware attack that targeted the country’s largest gas pipeline. That announcement had a negative impact on the price of cryptocurrencies. On Tuesday, the DOJ said it seized 63.7 bitcoins, worth approximately $2.3 million, from the members of the hacking ring. It is not clear how authorities obtained the private keys. However, experts suggested officials effectively hacked the hackers.
Bitcoin and other cryptocurrencies suffered substantial losses across the board on Tuesday. Bitcoin fell over 9% to reach a low of around $31,013.86. Ethereum followed the bearish path, as its price also fell on Tuesday.
The crash started one day earlier after reports surfaced that the DOJ seized an unspecified amount of cryptocurrency. The situation continued to deteriorate overnight-wiping out more than $150 billion in market value by 9:45 EDT on Tuesday.
On Sunday, two senators from the Intelligence Committee suggested lawmakers should take increased measures to regulate as well as trace cryptocurrencies.
Cryptocurrencies and regulations
Experts have long warned that heightened regulation could affect the cryptocurrency market’s massive rally. The last couple of weeks have proven that. Cryptocurrencies suffered huge losses in May due to the situation in China. Given the history, it is not surprising that the country is yet again cracking down on cryptocurrency.
Last month, the country’s financial industry regulators imposed extreme limitations on cryptocurrency in China. Immediately following the announcement, the price of bitcoin dropped to $30,000. China is a major player in the global economy, and its decisions have the potential to affect the global economy.
Regulators banned payment companies and financial institutions from offering customers any crypto-related services. Citizens can still own cryptocurrencies through crypto exchanges, but they can’t do much else with it. The new regulations require crypto to come up with a warning for investors, noting the challenges associated with crypto trading.
Regulators in China started to make decisions against bitcoin and other cryptocurrencies in 2013. Several years ago, the country banned banks and domestic exchanges from using it in transactions. In 2016, bitcoin prices rose in the country, but in 2017 regulators intervened again. They decided to ban initial coin offerings (ICO) to limit financial risks and protect crypto investors. In 2019, the country’s government recognized the need for blockchain technology. China created plans for its own central-bank digital currency.
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