Rising worries among investors that the price of bitcoin was being manipulated in a major exchange and concerns about stricter regulatory frameworks resulted in investors losing confidence in the virtual currency and consequently more than $100 billion was struck off the world’s cryptocurrency market within a period of just 24 hours on Friday.

According to data from Coinmarketcap.com, $405,241,490,138 at 6:30 a.m. London time was the total market capitalization or the market value of all of the virtual currencies combined and in circulation. This valuation is arrived at after considering the digital coin prices prevalent in multiple important virtual coin exchanges. Compared to the market cap a day earlier, this value was less by $112.6 billion.

In January of this year, there has been a major sell off in cryptocurrencies. According to CoinDesk’s bitcoin price index, on Thursday, the price of bitcoin fell below the $9,000 mark.  CoinDesk calculates values on the basis of prices of the virtual currency in four major such exchanges.

On Friday morning, there was a fall of 22 percent and 32 percent for two of the other most traded virtual coins Ethereum and ripple respectively compared to their prices a 24 hours ago.

There has been a series of negative news that has plagued the cryptocurrency market.

In India for example, the country’s Finance Minister Arun Jaitley said while presenting the annual budget on Friday that the government wants to “eliminate” digital currency usage related to criminal activities which is being considered to be indications of stricter regulation in the country on such currencies.

According to report in The New York Times on Wednesday, there are real worries expressed by a large number of investors in digital currency about the possible manipulation of the price of bitcoin. The report claimed that there are concerns that the very high price of bitcoin and some of the other virtual currencies have bene artificially inflated by the digital currency exchange Bitfinex. It is one of the exchanges that is tracked by CoinDesk and is part of its price index.

There was another news report this week that a subpoena has bene served to Bitfinex and a cryptocurrency company called Tether, both are reportedly run by a set of common executives, by the U.S. Commodity Futures and Trading Commission. There has however not been any comments from Bitfinex and Tether.

And a recent theft of over $500 million worth of a cryptocurrency called NEM was reported last week from the Japanese exchange Coincheck.

The cryptocurrency world has also been criticized severely by some of the key business leaders across the world. in a recent television interview, investing legend Warren Buffett opined that the sector “will come to a bad ending”.

However, there are others who are able to visualize long-term potential for digital coins like bitcoin and other. $9,000 is a “major low” for bitcoin and “the biggest buying opportunity in 2018”, said Fundstrat’s Tom Lee, the only major Wall Street strategist who has issued formal price targets on bitcoin.

There were possibility of bitcoin hitting prices between $50,000 and $100,000 this year, said Kay Van-Petersen, a Saxo Bank analyst who correctly predicted the cryptocurrency’s rally at the start of last year.

(Adapted from CNBC.com)

Categories: Economy & Finance, Regulations & Legal, Uncategorized