Bitcoin drops below $60,000; Ether falls amid crypto dip
NEW YORK: Cryptocurrencies fell on Tuesday, with Bitcoin sliding below $60,000 and Ether at its lowest levels this month.
The largest digital token dipped as much as 8.2% to $58,661. Second-ranked Ether tumbled more than 10%. Global crypto market cap has dropped some 10% in the past 24 hours to $2.7 trillion, according to tracker CoinGecko.
Technical indicators had suggested the strong run of late across the notoriously volatile market was due for a pause.
Some analysts also attributed the dip to new tax-reporting requirements for digital currencies that are part of the $550 billion infrastructure bill, which President Joe Biden signed into law Monday.
“We’ve seen the US infrarecords structure bill get signed, which has initiated a selloff from traders who are concerned about regulation and taxation,” said Hayden Hughes, chief executive officer of Alpha Impact, a social-trading platform.
Hughes also cited concerns about China continuing its regulatory crackdown. The country will study the option of levying punitive power prices for companies that are involved in cryptocurrency mining, National Development and Reform Commission spokeswoman Meng Wei said at a press conference.
Bitcoin has more than doubled this year, while Ether is up about sixfold. Both scaled last week amid a fervor for digital assets driven by speculative demand and controversial arguments that they can hedge inflation risks.
It “would be unusual to keep moving up without corrections,” said Vijay Ayyar, head of Asia Pacific with crypto exchange Luno in Singapore. He argued that “we’re seeing a healthy pullback” after a prolonged rally.
Bitcoin was trading at $59,801 at 10:36 a.m. in London.
Ether, the world’s second biggest cryptocurrency, fell to a 19-day low of $4,109.03 and was last down around 9.7% on the day.
If sustained, the move will be both cryptocurrencies’ biggest daily fall since September.
The Parliamentary Standing Committee on Finance met with industry associations and experts to discuss matters of crypto finance on November 15. The committee was led by Bharatiya Janata Party MP and former union minister Jayant Sinha.
At the meet, all parties concluded that cryptocurrency cannot be stopped, but must be regulated, news agency ANI reported citing sources.
There was reportedly a consensus that a regulatory mechanism should be put in place to regulate cryptocurrency. However, industry associations and stakeholders were not clear as to who should be the regulator.
“It’s important to balance innovation and regulation, highlights the need to 1. Ensure Investor Protection 2. Maintain Fiscal Stability 3. Ensure Adherence to FEMA and 4. Ensure cryptos aren’t used for illicit finances,” CNBC-TV18 quoted hairman of Parliamentary Panel on Finance Jayant Sinha.