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What's behind the latest Bitcoin crash?Getty
The value of Bitcoin in USD continued to decline this week, bringing the value of cryptocurrency to fall below $ 5,000 for the first time in 13 months. Bitcoin saw a fall of 14% over a 24-hour period last week, which could be partly due to the Commission's sanctions for US coffers and securities on two crypts that set out to offer ICO offers. Other important cryptocurrencies also suffered a significant decline in value, including ethereum, bitcoin liquidity and litecoin.
Regulation of initial coin offers
The first potential cause for the sudden fall in value of cryptocurrencies is the decision of the US Securities and Exchange Commission to classify ICOs as unlicensed titles, which means that those who offer such assets violated the law and had to pay fines and return .
While some argue that the SEC's intervention has long delayed, the commission has taken a seat in terms of overseeing and enforcing regulation within the encrypted market so far. However, the decision has certainly led some industry insiders to question the feasibility of the market in this period of uncertain regulation. The SEC decision will not be a surprise for many, but it may have been enough to scare off some investors who might remain on cryptography until clearer regulations are established not only by the US government but also by lawmakers around the world .
Bitcoin cash fork
But the unrest might come from loyal Bitcoin investors, split between two currencies. On the one hand there is Bitcoin Cash ABC while the second from the other, Bitcoin Cash SV, is the same Satoshi Nakamoto Craig Wright (self-proclaimed). This fork is the divisive element that cryptocurrency could do without.
The Bitcoin ABC developers have included a so-called checkpoint that forces miners to include the first Bitcoin Cash ABC block in any chain, without the chain being considered invalid by the client software. There are other software options for users and they can choose to exit the checkpoint version, but they open the risk that another crack occurs between a Bitcoin Cash ABC checkpoint and an uncontrolled Bitcoin Cash ABC checkpoint.
This latest fork renewed fears that Bitcoin Cash would be centralized and claimed that fears are at the heart of the fall in the value of Bitcoin Cash.
However, it is not the first fork for cryptocurrency, and even the changes that have taken place in the past have been the subject of controversy, but they have not caused the kind of decline in value observed this time. In the drop, Jehan Chu, Co-Founder & amp; Managing Partner at Kenetic.Capital commented: "Bitcoin's previously solid price anchor has been dropped from the recent Bitcoin Cash fork and is unlikely to recover soon." Craig Wright's antics have highlighted the fragile relationship between decentralized technology and Enormous influence exerted by their figures.To blockchain technology will no longer be useful to the people behind it, it is unlikely that price levels will remain sustainably high. "
Nvidia and Advanced Micro Devices
The third potential factor contributing to the sudden decline in value is the disappointing results announced by the chip makers Nvidia and Advanced Micro Devices, both of which are leading providers of hardware for cryptocurrency miners. The decline in sales has been seen as an indicator a decline in levels of interest in mining encryption. The biggest question about this is if the miners took off the next incident and stopped investing in hardware, or if the drop in hardware sales prompted investors to question long-term interest in cryptocurrency mining. Nvidia's share prices fell to a minimum of 16 months following the announcement of the drastic drop in sales and cryptomance crashes. It is not clear whether the decline in sales of chip manufacturers is a symptom or a cause of the crash, but there is a definite correlation between both significant events in the cryptocurrency market.
Opinion of those who live in the market
Industry experts came together to analyze the recent decline in the value of cryptocurrency. The collapse was largely attributed to the Bitcoin Cash fork, but some believe it could be due to an inevitable explosive bubble that came after a period of unsustainable growth.
Crypto Star YouTube Quinten Fran & ccedil; ois of the Young & amp; Invest canal said:
Market makers are finishing the cycle. We are currently sitting under "the medium" or fair value of Bitcoin, which means that we are in the last bearish phase of the cycle called "desperation". After that we should see a market inversion and start a new cycle. To what extent we fall is still a question, but one thing is that when Bitcoin falls to $ 5,000, it would have lost 75% of its value from the beginning to the end. This seems right considering that a market loses less value every other cycle in the maturation process. The last cycle of Bitcoin has lost 87% from the beginning to the end (2014), but that was a completely different market and industry. "
Michael Jeoung, CEO of Trustverse also believes that the fork is partly responsible, saying:
Crypto Civil War broke out from the hard money Bitcoin between ABC and SV (Satoshi Vision) and was one of the causes of the profound impact that the crypto market has brought down and many investors suffer from the accident. More importantly, this battle between ABC (Jihan Woo) vs SV (Craig Wright), has no public consensus nor DAU of the Bitcoin Cash token holders and this makes it ethically serious. It is a game of centralized and monopolized power, in which the blockchain is destined to become a mechanism of public and decentralized trust. Price manipulation by the power game is damaging digital wealth as well as its future value for technology development.
First of all, was not blockchain more about sharability and shared economy? More and more I feel this sector is that many things are manipulated, the information asymmetry exists bigger than the modern financial market, and moreover this incident has really influenced the distrust of many entities. No product or service that ignores the right or customer satisfaction fails and this civil war really implies personal interest over the public interest. Overall cryptocurrency transactions appear to be short and slowing for now. My confident vision is that the fundamental market has not changed. "
All in all, there will be enough people out there who will use the BCH capitulation to push prices across the space in what some call a technical move. And if the hash war has not ended, it could cause an inflow of money and could result in price stabilization or momentum. In any case, there may be a further decline before the currency starts making money.
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What's behind the latest Bitcoin crash?Getty
The value of Bitcoin in USD continued to decline this week, bringing the value of cryptocurrency to fall below $ 5,000 for the first time in 13 months. Bitcoin saw a fall of 14% over a 24-hour period last week, which could be partly due to the Commission's sanctions for US coffers and securities on two crypts that set out to offer ICO offers. Other important cryptocurrencies also suffered a significant decline in value, including ethereum, bitcoin liquidity and litecoin.
Regulation of initial coin offers
The first potential cause for the sudden fall in value of cryptocurrencies is the decision of the US Securities and Exchange Commission to classify ICOs as unlicensed titles, which means that those who offer such assets violated the law and had to pay fines and return .
While some argue that the SEC's intervention has long delayed, the commission has taken a seat in terms of overseeing and enforcing regulation within the encrypted market so far. However, the decision has certainly led some industry insiders to question the feasibility of the market in this period of uncertain regulation. The SEC decision will not be a surprise for many, but it may have been enough to scare off some investors who might remain on cryptography until clearer regulations are established not only by the US government but also by lawmakers around the world .
Bitcoin cash fork
But the unrest might come from loyal Bitcoin investors, split between two currencies. On the one hand there is Bitcoin Cash ABC while the second from the other, Bitcoin Cash SV, is the same Satoshi Nakamoto Craig Wright (self-proclaimed). This fork is the divisive element that cryptocurrency could do without.
The Bitcoin ABC developers have included a so-called checkpoint that forces miners to include the first Bitcoin Cash ABC block in any chain, without the chain being considered invalid by the client software. There are other software options for users and they can choose to exit the checkpoint version, but they open the risk that another crack occurs between a Bitcoin Cash ABC checkpoint and an uncontrolled Bitcoin Cash ABC checkpoint.
This latest fork renewed fears that Bitcoin Cash would be centralized and claimed that fears are at the heart of the fall in the value of Bitcoin Cash.
However, it is not the first fork for cryptocurrency, and even the changes that have taken place in the past have been the subject of controversy, but they have not caused the kind of decline in value observed this time. At the fall, Jehan Chu, co-founder and Managing Partner of Kenetic.Capital commented: "Bitcoin's solid price anchoring has been released from the recent Bitcoin Cash fork and is unlikely to recover soon. Craig Wright exposed the fragile relationship between decentralized technology and the enormous influence of their nominee, and until the blockchain technology becomes more useful than the people behind it, price levels are unlikely to remain high. "
Nvidia and Advanced Micro Devices
The third potential factor contributing to the sudden decline in value is the disappointing results announced by the chip makers Nvidia and Advanced Micro Devices, both of which are leading providers of hardware for cryptocurrency miners. The decline in sales was seen as an indicator of a decline in levels of interest in mining encryption. The biggest question about this is if the miners took off the next incident and stopped investing in hardware, or if the drop in hardware sales prompted investors to question long-term interest in cryptocurrency mining. Nvidia's share prices fell to a minimum of 16 months following the announcement of the drastic drop in sales and cryptomance crashes. It is not clear whether the decline in sales of chip manufacturers is a symptom or a cause of the crash, but there is a definite correlation between both significant events in the cryptocurrency market.
Opinion of those who live in the market
Industry experts came together to analyze the recent decline in the value of cryptocurrency. The collapse was largely attributed to the Bitcoin Cash fork, but some believe it could be due to an inevitable explosive bubble that came after a period of unsustainable growth.
Crypto Quinten François's YouTube star on the Young & Investing channel said:
Market makers are finishing the cycle. We are currently sitting under "the medium" or the right value of Bitcoin, which means that we are in the last bearish phase of the cycle called "desperation". After that we should see a market inversion and start a new cycle. To what extent we fall is still a question, but one thing is that when Bitcoin falls to $ 5,000, it would have lost 75% of its value from the beginning to the end. This seems right considering that a market loses less value every other cycle in the maturation process. The last cycle of Bitcoin lost 87% from the beginning to the end (2014), but that was a completely different market and industry. "
Michael Jeoung, CEO of Trustverse, also believes that the fork is partly responsible, saying:
Crypto Civil War broke out from the hard money Bitcoin between ABC and SV (Satoshi Vision) and was one of the causes of the profound impact that the crypto market has brought down and many investors suffer from the accident. More importantly, this battle between ABC (Jihan Woo) vs SV (Craig Wright), has no public consensus nor DAU of the Bitcoin Cash token holders and this makes it ethically serious. It is a game of centralized and monopolized power, in which the blockchain is destined to become a mechanism of public and decentralized trust. Price manipulation by the power game is damaging digital wealth as well as its future value for technology development.
First of all, was not blockchain more about sharability and shared economy? More and more I feel this sector is that many things are manipulated, the information asymmetry exists bigger than the modern financial market, and moreover this incident has really influenced the distrust of many entities. No product or service that ignores the right or customer satisfaction fails and this civil war really implies personal interest over the public interest. Overall cryptocurrency transactions appear to be short and slowing for now. My confident vision is that the fundamental market has not been changed ".
All in all, there will be enough people out there who will use the BCH capitulation to push prices across the space in what some call a technical move. And if the hash war has not ended, it could cause an inflow of money and could result in price stabilization or momentum. In any case, there may be a further decline before the currency starts making money.
