The cryptocurrency market experienced the first correction of the year. The overall cryptocurrency market cap dropped from over $700 billion in the beginning of the week to as low as $414 billion (or a 43% drop) 3 days later.
The magnitude and speed that the market dropped was astonishing, especially considering that there were no obvious negative news affecting the cryptocurrency market.
One theory that explains the drop is that Wall Street manipulated the market just in time for the first expiry of Bitcoin futures contract. This way, those who shorted futures can profit by depressing the prices right at the contract expiry time. It is difficult to confirm this theory but we find it to be the best explanation of the sharp correction.
During this correction, blue chip coins like Bitcoin and Ether were more resilient than most of the other smaller coins. This shows that there is a flight to quality when the market experiences a downturn.
The market ended the week at around $600 billion, or a drop of 18% from the previous week. Bitcoin dropped 11% to around $12,000 and ether dropped 17% to around $1,080 during the same period.
It is remarkable how quickly the market crashed and rebounded. This kind of movement usually takes weeks or even months to play out, but it all happened within the span of a week.
We believe that occasional corrections are healthy for the market. After a correction, market sentiment becomes less euphoric and more rational, which is the foundation of another leg up.
Bitconnect, which has been accused of running a Ponzi scheme, shuts down: https://techcrunch.com/2018/01/16/bitconnect-which-has-been-accused-of-running-a-ponzi-scheme-shuts-down/
Japan's Biggest Bank Is Releasing Its Own Cryptocurrency In March: https://www.investopedia.com/news/japans-biggest-bank-releasing-its-own-cryptocurrency-march/
South Korean Petition Against Crypto Regulation Gets 200K Signatures: https://cointelegraph.com/news/south-korean-petition-against-crypto-regulation-gets-200k-signatures-government-must-respond
Visa CEO: We won't process transactions in bitcoin, because it's not a payment system: https://www.cnbc.com/2018/01/17/visa-will-not-process-bitcoin-transactions-says-ceo-alfred-kelly.html
Billionaire Mark Cuban says the Dallas Mavericks will accept bitcoin next season: https://www.cnbc.com/2018/01/17/mark-cuban-nbas-dallas-mavericks-will-accept-bitcoin-next-season.html
St. Louis Federal Reserve Reps in Favor of Cryptocurrencies: https://news.bitcoin.com/st-louis-federal-reserve-reps-in-favor-of-cryptocurrencies/
Ledger raises another $75 million to become the leader in cryptocurrency hardware wallets: https://techcrunch.com/2018/01/18/ledger-raises-another-70-million-to-become-the-leader-in-cryptocurrency-hardware-wallets/
Articles From Crush Crypto
TraDove ICO Review: https://crushcrypto.com/tradove-ico-review/
WePower ICO Review: https://crushcrypto.com/wepower-ico-review/
Republic Protocol ICO Review: https://crushcrypto.com/republic-protocol-ico-review/
* The information contained in this article is for education purpose only and not financial advice. Do your own research before making any investment decisions.