Digital currencies continue to collapse! Bitcoin once fell below $7,000, hitting a three-month low

After returning to $9,000 last Saturday, Bitcoin fell again since last Sunday, breaking through the three thresholds of $9,000, $8,000 and $7,000 in succession, driving a collective decline in digital currencies. The overall market value wiped out at least $60 billion in the past 24 hours.

According to quotes from the Bitstamp platform, Bitcoin hit a low of $6,600 in midday trading on Monday, the first time it has fallen below $7,000 since November 15 last year. It fell more than 18% on the day and fell $1,800 from its intraday high.

The price of GDAX, owned by Coinbase, the largest digital currency trading platform in the United States, also fell below $7,000, reaching a low of $6,425, but the price of Bitcoin on various platforms returned to above $7,000 after the U.S. stock market closed.

Financial blog Zerohedge found that digital currencies collectively narrowed their previous losses at 3 p.m. Eastern Time, while U.S. stocks fell below important integer points one after another during the same period.

As of Monday, Bitcoin has fallen more than 60% from its all-time high of nearly $20,000 on December 17, one of the largest declines in history. Last week, Bitcoin fell 30%, the worst weekly performance since 2013; on January 31, Bitcoin fell below the $10,000 mark, down nearly 46% from the beginning of the year, the largest monthly decline since February 2014.

(The above picture comes from the Bitcoin decline record reprinted by the financial blog Zerohedge)

According to CoinMarketCap, the top 20 digital currencies by market value continued to fall by double digits in the past 24 hours. The overall market value of the digital currency market fell to $346.2 billion, wiping out $66 billion in the past 24 hours.

Bitcoin Cash fell below $1,000 for the first time since November last year, less than a quarter of its highest price on December 21 last year. Ethereum fell below the $700 mark for the first time since mid-December last year, and Ripple fell below $1 for the first time since Christmas; Litecoin fell to its lowest level since February 10, less than $132. Only Tether, a digital currency that is said to be 1:1 pegged to the US dollar, rose by more than 1% in the past 24 hours.

Digital currencies face double negative impact from British and American banks and global regulation

A series of negative news has triggered a series of declines in digital currencies in recent days.

Last Thursday, Coinbase, the largest Bitcoin exchange in the United States, notified its customers that banks have begun treating Bitcoin deposits as "cash advances," meaning that high fees and interest must be paid when purchasing cryptocurrencies through credit cards.

Last Friday, Bank of America, JPMorgan Chase and Citigroup announced that they would follow Capital One in banning the use of their credit cards to purchase Bitcoin and other digital currencies. On Monday , Lloyds Banking Group also announced that it would ban the use of its credit cards in transactions involving digital currencies. A spokesperson for the bank said:

This is to protect our credit card customers from the risk of cryptocurrency price fluctuations.

In addition to the actions of these institutions, senior officials in Asia and Europe have made statements on regulating digital currencies.

Last night, the Financial Times, a subsidiary of the People's Bank of China, reported that China will take a series of regulatory measures against ICOs and virtual currency transactions at home and abroad, including banning related business entities and banning and disposing of virtual currency trading platform websites at home and abroad.

The report also mentioned that investors need to recognize the risks associated with overseas ICOs and virtual currency trading platforms, firmly establish a risk prevention awareness, and not participate in related illegal and irregular activities.

On February 1, Indian Finance Minister Jaitley said that the use of cryptocurrencies for illegal purposes would be cracked down on, and emphasized that cryptocurrencies are not legal currencies. The government will not consider legalizing cryptocurrencies and will prevent the use of Bitcoin and other cryptocurrencies within its jurisdiction.

On the same day, Ewald Nowotny, member of the European Central Bank's Governing Council and president of the Austrian Central Bank, also said that it is now necessary to legislate in order to regulate digital cryptocurrencies including Bitcoin. At present, it is necessary to pass legislation to address the risk of money laundering.

Prior to this, from January 30, South Korea ended anonymous transactions, and even if they passed the real-name authentication, foreign investors and minors stipulated in the country's "Civil Code" could not trade digital currencies. For more analysis of South Korea's latest digital currency regulation, please see the editor-in-chief of Wall Street News's selection of "Read the News | What does the disappearance of Bitcoin's "Kimchi Premium" mean?"

Bullish voices on Bitcoin still exist: Is rising to 100,000 not a dream?

Financial blog Zerohedge observed that the decline in Bitcoin prices and the rise in the US stock market's "fear index" VIX have shown an increasingly obvious positive correlation, which may mean that with the return of US stock volatility, digital currencies led by Bitcoin still have room to fall. It may also mean that technology companies such as AMD and Nvidia that provide graphics cards for digital currency mining have a poor outlook for future stock prices.

(The above picture is a screenshot from the financial blog Zerohedge statistics)

Wall Street is still full of bullish voices on Bitcoin. Tom Lee, co-founder of Fundstrat Global Advisors, which was the first to give professional investment quotes, reiterated his optimistic outlook, believing that Bitcoin's fundamentals are intact and that the target price by the end of the year is $25,000.

Kay Van-Petersen, an analyst at Denmark's Saxo Bank, also said in an exclusive interview with financial media CNBC in mid-January that he had successfully predicted a sharp rise in Bitcoin in 2017 and believed that Bitcoin would rise to the range of US$50,000 to US$100,000 this year, meaning that the current sharp drop is nothing to be feared.