Bitcoin leads Asian selloff in digital currencies

TOKYO: Shares of several cryptocurrency-related companies in Asian markets fell after Bitcoin led a selloff in digital currencies.

Monex Group Inc, which owns the Japanese exchange Coincheck, and SBI Holdings Inc fell over two per cent to trade at two-week lows here, while Vidente Co and Omnitel Inc retreated at least six per cent in Seoul to lead declines among crypto-linked stocks.

Bitcoin plunged as much as 15 per cent during United States trading hours, and traded at US$5,544.37 as of 1pm in Hong Kong, according to Bloomberg consolidated pricing data

Rival coins also retreated, as the industry braces for a contentious split in Bitcoin offshoot Bitcoin Cash.

“The US$6,000 (RM25,128) mark, which had been serving as a floor for a long time, gave way — this feels like a bit of a dangerous sign,” said Soichiro Tsutsumi, a trader with eWarrant Japan Securities K.K. in Tokyo.

“Companies most impacted by the price move would be the ones with business models reliant on a client pool, on concern that the number of client accounts won’t expand.”

Bitcoin’s slump pushes prices into “deeply oversold” territory and suggests it may be due for a short-term rally, however longerterm technical indicators aren’t so favorable, said Rob Sluymer with Fundstrat Global Advisors.

“This week’s breakdown produced significant technical damage,” Sluymer wrote in a note on Wednesday.

“That will likely take weeks, if not months, to repair to create a durable enough price ‘structure’ to support a multi-month rally.”

One stock bucking the trend was Ceres Inc, up 16 per cent for its biggest gain since January.