Bitcoin fell by almost 8% earlier today before recovering slightly. The leading cryptocurrency by market cap dropped to nearly $60,000. Other major cryptocurrencies also experienced a sharp decline. The global crypto market cap has dropped some 7% in the past 24 hours to $2.8 trillion, according to tracker CoinGecko. The second leading cryptocurrency by market cap, Ether, also slid by as much as 6.8% and was trading at $4,273.
Upcoming regulations in different countries may impact bitcoin’s price.
Hayden Hughes, chief executive officer of Alpha Impact, said to Bloomberg that we have seen the U.S. infrastructure bill get signed, initiating a selloff from traders concerned about regulation and taxation. “More recently, we’ve also been hearing reports that the Chinese government is set to announce new restrictions against large-scale Bitcoin mining, including against state-owned enterprises,” he added. New tax-reporting requirements for digital currencies are part of the $550 billion infrastructure bill that President Joe Biden just signed into law. Meanwhile, China has imposed a broad crackdown on the crypto industry due to the power consumption and potential environmental fallout of Bitcoin mining.
Bitcoin has more than doubled this year.
The original cryptocurrency bitcoin has more than doubled this year, while Ether is up about sixfold. Both scaled records last week amid a fervor for cryptocurrencies driven by speculative demand and controversial arguments that they can hedge inflation risks. Some technical indicators had suggested the strong run in cryptos was due for a pause. Digital tokens are, in any case, notoriously volatile. At the time of writing, bitcoin is trading at just above $61,131.