Cryptocurrencies suffer double-digit losses

The continuous rise of Bitcoin; creates a record

Bitcoin, on Wednesday morning, fell significantly at $10,000 thus marking the second day of double-digit declines for the virtual currency. Now a bitcoin is worth $9,700, which is below than the value of $19,500 achieved just last month.

Bitcoin is not the only cryptocurrency that is declining. Every major cryptocurrency has now suffered double-digit declines for the second day in a row.

Now Ethereum is worth $810, fell by 42 percent from its peak above $1,400 just four days ago. Litecoin declined to $150—down by 58 percent from its peak of $360 on December 19. The rival version of Bitcoin, Bitcoin Cash, was worth more than $4,000 on December 20, but now it’s worth $1,500, a 65 percent decline.

Although there appears to be no apparent reason for the wide-ranging sell-off, some reports indicate that South Korea may have regulated cryptocurrencies more strictly, but it’s hard to believe that these rumours are alone enough for a big global sell-off.

Apparently, the current round of panic-selling reflects the enormous number of new investors that have inundated the market in the recent months. A leading bitcoin exchange, Coinbase declared in November that it had an astonishing 13 million investors.

Several of those new investors seem to have little knowledge regarding the underlying technology and possess little experience investing in highly unstable instruments like bitcoin. While the price was surging, they were happy to continue holding or even buy more. However, as the price began to drop, some of them inevitably lose their nerve and panic-sell, accelerating the price decline.

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