Ugh… Many traders and Ethereum investors are likely starting to get that sick feeling in the bottom of their stomachs as they wake up to notice that the price of the world’s second largest cryptocurrency and the primary competitor to bitcoin has fallen by over $25 in less than 24 hours. At press time, Ethereum is trading for $411, about $26 less than where it stood yesterday afternoon.
Ethereum is not the only currency affected. It appears that one major currency drop tends is usually replicated by the others. Bitcoin, for example, is causing quite a stir now that it has fallen below the $6,000 mark to $5,800. Ethereum, on the other hand, remains above the $400 position it has managed to retain for so long, though it is unclear how much more the currency can withstand.
Ethereum has seen over 15 percent of its total market value disappear within the last seven days alone, and not since last April has a price this low been witnessed in the ether space. At the beginning of June, Ethereum was trading for approximately $622.55, meaning the asset has lost over 34 percent of its value in just the last four weeks. This is larger than bitcoin’s total loss of 24 percent over the same time frame.
This would suggest that Ethereum is returning to its “pre-spike” position, and that the currency has ultimately been licking its wounds from the December drop for six months. This could mean one of two things: 1) that a recovery period and respective bull run are due sooner than expected, or 2) that the market will continue to drop lower for the next few months until momentum decides to pick up.
Securities and Exchange Commission (SEC) director of the division of trading and markets Brett Redfearn recently commented that he is surprised by the lack of new ICOs and investors entering the crypto space, particularly after the announcement that Ethereum would not be classified as a security. Speaking at the Sandler O’Neill Global Exchange and Brokerage Conference in New York, Redfearn exclaimed to his audience:
“We are underwhelmed by the enthusiasm for coming within the regulatory structure, right now. There are a number of exchanges that are trading ICOs, and I would think that we would see more registrations.”
He believes the growth in stricter regulation has caused many traders to lose their interest in the crypto market. In addition, he also claims that cryptocurrency companies are thinking twice before stepping into the ring due to concerns about new and upcoming laws.
At press time, Ethereum has lost nearly all its support, and heavy resistance has developed between the $425 and $430 marks. Should the currency manage to move beyond these points, it could also face resistance at $450.
Dan Phifer – co-founder of the music sharing platform Musiconomi – raised several thousand ether coins in an ICO last year. He says, “While we certainly have not given up hope that there will be a recovery period, it’s obvious that if there is recovery, it isn’t going to be anytime soon.”
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