Cryptocurrency prices saw a sharp decline on Wednesday. At one point, ETH hit a value of $210 and Bitcoin was at $6,300. According to data from Coinlib, total crypto market capitalization collapsed from $239 billion on September 5 to $200 billion on September 6. One of the probable reasons behind this fall was a Business Insider report that Goldman Sachs was scrapping its plans to launch a cryptocurrency trading platform. Regulations, current economic affairs, speculations by crypto investors and experts, hacking activities and new digital currencies are some factors which affect the price of cryptocurrencies.
The fluctuation in cryptocurrency prices comes as a reminder to enthusiasts just how volatile and high risk this crypto world is, and that people should always check all the parameters carefully before diving into this world.
Since falling from $7,400 to $6,300 on September 6, Bitcoin is now in the $6,400 region. Bitcoin has been fairly stable at $6,400, recording a movement that has allowed tokens to minimize losses against BTC and other major cryptocurrencies. This week (September 1– September 8, 2018) cryptocurrency market capitalization has a fluctuating trend with a commendable rate and as of writing, equaled $201.01 billion (see below figure). On September 5, the total market cap was $208.72 billion. It was decreased by almost 30 billion from September 4, the market cap was $238.13 billion. Right now, the total market cap is $202.62 billion.
Dominance of Cryptocurrencies
Now the dominance of the trendsetter cryptocurrency Bitcoin (BTC) as of writing has been 55%. On September 1, its dominance was 51%.
Of the top 100 currencies, Ethereum (ETH) dominance was at 12% on Sep 1. ETH dominance is continuously showing fluctuating behavior. It was at 14% on Sep 5 and 12% on Sep 7 and as of writing this article, it is at 11%.
Ripple (XRP) was at 6% on Sep 1 and as of writing this article, it is at 6%. It was decreased to 5% on Sep 6.
Regulations play a major role in the rise and fall of cryptocurrencies. A few days ago, the European Union’s 28 member states have decided to scrutinize cryptocurrencies and the regulatory challenges they pose. Finance Ministers from the member states will convene to discuss whether or not regulations on the industry should be tightened and will be looking at issues including the lack of industry transparency, and the misuse of cryptocurrency for illicit purposes, like money laundering, tax evasion, and financing terrorism.
The U.S. handles the second largest volume of bitcoin, roughly 26 percent, according to Cryptocompare. Investors in the United States have been witnessing the regulators sending mixed signals, even though the Securities Exchange Commission (SEC) has been fairly quiet on cryptocurrency regulation, they have been rejecting countless ETF applications citing reasons of “market manipulation” and volatility.
Not only this, according to few crypto enthusiasts, BitMEX planned and manipulated Bitcoin price.The reason behind this assumption is that BitMex planned a maintenance of its platform on a definite date and it affected the demand and supply and therefore the price of the token went above $6,700. BitMEX announced a scheduled maintenance that was going to be implemented on August 21st.
The support lasted 1 hour, and during that time few transactions were frozen because BitMEX is responsible for almost 40 percent of the total transactions with Bitcoin. People also claimed that short contract holders on BitMEX were liquidated so that they could not close their contracts. Youtube channel Bitraged uploaded a video in which it labels the action as a “market manipulation” and even says the event has all the characteristics of a textbook case.
Total Volume Of Cryptocurrencies
Now, the total volume of the cryptocurrency market is also showing fluctuating behavior. On Sep 1, it was $5.97 B. All of a sudden it was increased and Sep 5 saw the highest volume of cryptocurrency at $7.35 B.Following figure is showing us the total volume of cryptocurrency on 1 Sep 2018. It is at $4.03 B.
The legitimacy, price, volume and total market cap of cryptocurrencies depend on the country’s leading provider of banking systems. There are several factors such as approvals of various sections like SEC and what regulators think. Crypto market tends to react rapidly to any decisions regarding cryptocurrency regulation.
Disclaimer: This information should not be interpreted as an endorsement of any cryptocurrency. It is not a recommendation to trade. The cryptocurrency market is full of surprises and overhyped assets. Do your research before buying anything.