Cryptocurrencies, Bitcoin plunge amid crackdown scare

LONDON (Reuters) – Bitcoin slid as much as 18% on Tuesday to a four-week low, as fears of a regulatory crackdown on the market spread after reports suggested it was still possible that South Korea could ban trading in cryptocurrencies.

Bitcoin’s slide triggered a selloff across the broader cryptocurrency market, with biggest rival Ethereum down 23% on the day at one point, according to trade website Coinmarketcap, and the next-biggest, Ripple, plunging by as much as a third.

Bitcoin traded as low as $11,191.59 on the Luxembourg-based Bitstamp exchange. By 1400 GMT it has edged up to $11,650, but that was still down more than 14%, leaving it on track for its biggest one-day fall since September.

Jamie Burke, chief executive of Outlier Ventures, a venture capital firm that is one of the biggest holders of top-10 cryptocurrency IOTA, said the belief the market was overdue a correction was making traders jittery and that was exacerbating the scale of the moves.

“Anybody that understands the technology knows there’s going to be a correction – it’s going to be a big correction and it’s going to be indiscriminate, because there are no established fundamentals for anybody to distinguish between where there is and isn’t value,” Burke said.

“There’s no way you can rationalize that there’s any value in the market at the moment; everything is significantly overpriced,” he added. Burke holds a number of top-20 cryptocurrencies in a personal capacity.