Bitcoin fell by 9.30 per cent in the past seven days after touching an all time high of $42000 January 8, according to data from coinmarketcap.com.
The world’s most popular cryptocurrency within the last 24 hours hit a low of $31,107 and has witnessed a $33,687 high as at Monday morning trading session, the data showed.
The dip in Bitcoin’s value comes amidst growing fears of U. S. stricter regulation and continuing concerns about cryptocurrency’s price volatility.
Traders said they were afraid that the just installed U.S. president, Joe Biden, administration could attempt to regulate cryptocurrencies.
This was also triggered by sentiments when the head of U.S. Treasury, Janet Yellen, during a Senate hearing on Tuesday stated that cryptocurrencies could be used to finance illegal activities.
“I think many are used, at least in a transaction sense, mainly for illicit financing, and I think we really need to examine ways in which we can curtail their use and make sure that money laundering does not occur through these channels,” she said.
Crypto expert and blockchain enthusiast, Iniobong Williams, said “Historically, I think It’s normal to expect 30-70% pull back in the prices of crypto currencies after they reach or exceed previous all time highs.”
He said the public must understand that the market does not only move in linear fashion as it makes it unhealthy. He also said that the crypto market must experience corrections from time to time because the market reacts to the laws of demand and supply, as well as other market dynamics.
Mr Williams said the crypto market is still in its infant stage and that the market is highly volatile and unregulated to a larger extent.
“A crash in price is to be expected from time to time,” he added.
However, he said a crash in price could mean huge losses for some new traders and investors, as well as a golden opportunity for other seasoned traders and investors.
“It is advised that you seek the guidance of an expert before investing in crypto currencies,” he explained.
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