The entire cryptocurrency market has suffered quite a bit this week but fortunately, things seem to be leveling off.
On Monday morning at 12 AM EST, CoinMarketCap decided to take off a few major South Korean Exchanges from its global index, without notifying the public. The market, at the time, was already down-facing and the sudden “drop” caused major panic amongst investors and major sell-offs occurred causing coins to plummet even further on the index.
It wasn’t until 11 hours later that the website notified the public, via Twitter, of the business decision that was made and implemented. Many were outraged and felt as investors they should have been notified days in advance, as the “crash” wasn’t an actual crash at all but more of a false correction. CoinMarketCap collects its data from multiple global exchanges and compiled the data into an averaged price, of each cryptocurrency.
The global index has yet to respond to the backlash it has received on its post but it was discovered that Bithumb, coinone, and korbit were the exchanges removed. These Korean exchanges have been notorious for having its crypto prices well above the global market average and the decision to remove them, was not a surprise to many.
In just over 72 hours, the entire global market cap has dipped just over $200 billion USD and at press-time, the current market cap is $697 billion. However, exactly one year ago the entire market cap of all cryptocurrencies was just over $15 billion. With as much growth the market has had in the last year, some correction should be anticipated.
Late last night, the South Korean Justice Minister announced that further steps the country will be taken in banning cryptocurrency and the implementation to remove the trading of the digital currencies off its major exchanges. After the news broke, all the currencies began nose-diving in price and Bitcoin lost almost $2000 in value. The ban isn’t entirely finalized yet and there is currently a petition with over 55,000 signatures, requesting the stoppage of the ban.
Warren Buffett, one of the U.S’s wealthiest businessmen and investors, also gave a negative statement against cryptocurrencies stating the digital currencies will “come to a bad ending.” It cannot be ruled out that his remarks on cryptocurrency haven’t influenced and spooked some crypto investors. However, many financial executives have been slamming cryptocurrency for years. The most noted is JP Morgan’s (NYSE:JPM) Jamie Dimon, who just recently called Bitcoin an actual currency, which is monumental for the CEO.
With South Korea’s regulation unclear, high volatility is to be expected. Many new cryptocurrency investors have become too easily spooked and must realize with any sort of growth, there is always price corrections. As exchanges continue to fix scaling issues and allow new investors back in next week, the price of most of the top digital currencies should climb back.
Featured Image: twitter