Bitcoin and other cryptocurrencies have seen a downward trend in its prices. Bitcoin price fell more than 22% in recent days in March 2018 and traded almost 6% lower against US dollar. Why are we seeing such a fall in its price recently?
Reports state,the main reason for the fall of bitcoin price is due to a warning from the US regulatory commission SEC. Along with bitcoin, bitcoin cash also traded 5.6% lower against US dollar.
Within a 24 hour period right before March 11, 2018, almost around $5.28 billion worth of bitcoins have been traded. Bitcoin has a market cap of $148.36 billion. Speaking on CNBC News, Bob Pisani, senior news correspondent said, “Cryptocurrencies have seen more fallouts today for fears of regulations.”
The US Securities and Exchange Commission (SEC) announced that it will apply securities laws on cryptocurrency exchanges and digital asset storage companies also known as wallets.
The commission said, “If a platform offers trading of digital assets that are securities and operates as an ‘exchange,’ as defined by the federal securities laws, then the platform must register with the SEC as a national securities exchange or be exempt from registration,” on its “Statement on Potentially Unlawful Online Platforms for Trading Digital Assets.”
Many online trading platforms pretends to be SEC-registered and regulated marketplaces to customers when actually they are not. Many exchanges are referring themselves as ‘exchanges’, when actually they are misleading the investors by falsely claiming that they meet the regulatory standards of a national securities exchange.
According to the agency, exchanges need to abide by federal laws to protect the investors’ interests.
Coinbase, one of the leading cryptocurrency exchange for bitcoin and ethereum declined to comment anything about the SEC’s statement on CNBC. Bittrex, another leading cryptocurrency exchange said on CNBC that “Bittrex uses a robust digital token review process to ensure the tokens listed on the exchange are compliant with U.S. law and are not considered securities.”