Bitcoin BTC , ethereum and other major cryptocurrencies have suffered a sudden crash after a week that saw some of the biggest crypto companies rocked by shock regulatory action— with further bombshells on the way .
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The bitcoin price has dropped to around $25,000, down 5% to its lowest level since March and mirrored by declines seen by the ethereum price.However, other top ten cryptocurrencies—BNB, XRP XRP , cardano, matic, dogecoin and solana—have all suffered far larger declines, losing between 10% and 25% in mere hours.
Crypto’s latest crash—plunging the crypto market to around $1 trillion and described as an “absolute bloodbath” by one trader on Twitter—comes as one of the top global credit rating agencies, Moody’s, dropped its outlook on embattled bitcoin and crypto exchange Coinbase from stable to negative.
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Moody’s analysts wrote that the “uncertain magnitude” of events this week had triggered their Coinbase downgrade, putting its price outlook at “negative” for the next 12 to 18 months.
This week, the U.S.Securities and Exchange Commission (SEC) charged Coinbase with operating illegally, widening its crackdown on the industry after suing the world’s largest crypto trading platform, Binance, accusing it of a range of violations that include mishandling user funds, inflating trading volume and evading regulation.
“The change in outlook to negative from stable reflects the uncertain magnitude of impact the SEC’s charges will have on Coinbase’s business model and cash flows,” Moody’s researchers wrote .
Coinbase stock, peaking shortly after its 2021 market debut at the top of the bitcoin and crypto bull run, has crashed by almost 90% due to growing fears a U.S.crypto trading crackdown could spell the end of the industry.
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Topping off a week of upheaval for the bitcoin and crypto market, Binance’s U.S.affiliate halted dollar deposits and signaled it would also soon be unable to facilitate dollar withdrawals.
Trading app Robinhood, meanwhile, said it’s ending support for three major cryptocurrencies—cardano, polygon and solana—in the wake of the SEC branding them unregistered securities and Singapore-based crypto exchange Crypto.com announced that it intends to halt services for U.S.-based institutional traders later this month.
“This week’s sweeping regulatory pronouncements saw crypto realized volatility begin to rear its head,” Gordon Grant, co-head of trading at Genesis Trading, wrote in an emailed note.
“After seeming months of coiling in an ornery, reptilian rip-rap price action, the successive Monday and Tuesday swoon-soar tandem on the back of Binance and Coinbase headlines preempted consternation, head scratching and, if nothing else, a recognition that the asset class remains habitually prone to lurid gaps in price action.”
Billy Bambrough.
