Bitcoin Falls Below $6000, Plummeting 70% From December High

Bitcoin Falls Below $6000, Plummeting 70% From December High

The massive dips in the last few weeks managed to translate into a whopping $67 billion in market value; this shook the market and investors alike as the Bitcoin circulation is now tallied to be around the $125.8 billion. It's not a static feature.

As regulatory chatter continues to hammer the markets, we can expect new lows to continue coming along, with investors unlikely to be too interested in getting burnt. "This is the real thing". The digital currency fell below $8,000 on the news that more and more financial institutions are refusing to allow Bitcoin transactions.

Cryptocurrency, which gained popularity because of its non-reliance on governments and banks, has also been the target of hackers who have reportedly stolen millions of dollars worth of Bitcoin in recent months.

A 58-billion-yen theft from a Japanese cryptocurrency exchange last month also caused investors to flee from digital currencies.

Less than two months after Bitcoin's value soared to an all-time high of almost $20,000, the cryptocurrency has started February with an equally impressive fall.

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The gains came amid a U.S. Senate hearing on virtual currencies in which J. Christopher Giancarlo, chairman of the Commodity Futures Trading Commission (CFTC) and Jay Clayton, chairman at the Securities and Exchange Commission (SEC) have been testifying. Such is the demise that the total market cap at the time of writing is actually well below Bitcoin's all-time high market cap of $326.14bn hit in in mid-December.

US regulators may ask Congress to pass legislation to improve oversight of virtual currencies like bitcoin amid concerns about the risks posed by the emerging asset class, Clayton said on Tuesday.

After a massive run-up in prices last year, in which investors across the world piled into the market, cryptocurrency prices have skidded lower this year at the same time as regulators have stepped up warnings about the risk of investing in them.

Regulatory clampdowns in South Korea and India and an advertising ban by Facebook Inc (FB.O) have hit sentiment.

Lloyds Banking Group said over the weekend that it was banning customers from using credit cards to buy bitcoin.

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Still, many cryptocurrency backers say that regulation should be welcomed, and that short-term price volatility is to be expected for a new market backed by a potentially powerful technology.

Clayton in testimony on Tuesday said Congress may need to change financial laws to better regulate cryptocurrencies.

"This is an extremely volatile market", said Iqbal Gandham, managing director at trading platform eToro.

After peaking from December to early January, the value of a number of cryptocurrencies have kept on falling - in fact, some have approximately halved in price in the past two weeks.

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