You are using an older browser version. Please use a supported version for the best MSN experience.

Bitcoin price: what caused values to crash?

The Week logo The Week 26/07/2019 Cameron Tait
a hand holding a cellphone © Provided by Dennis Publishing Limited

After months of gains and investor interest, bitcoin is on course to end the month at a loss for the first time since January.

Bitcoin values have frequently dipped below the $10,000 (£8,050) mark over the past few days, just two weeks after prices surpassed the $13,000 (£10,460) threshold for the first time this year, according to ranking site CoinMarketCap. 

Despite trading close to the $11,000 (£8,850) mark at the start of the month, values may continue to sink below $10,000 over the coming days, the website reports. Bitcoin is currently trading at $9,820 (£7,900), as of 2:30pm UK time.

As is often the case in the cryptocurrency market, bitcoin’s price fluctuations have also had an impact on its rivals. 

ILLUSTRATION - A Bitcoin is photographed during the 'Bitcoin Exchange Berlin' at the Betahaus in Berlin, Germany, 24 November 2013. The 'Bitcoin Exchange Berlin' is an offline exchange for Bitcoin trade that takes place monthly. Photo: JENS KALAENE | usage worldwide   (Photo by Jens Kalaene/picture alliance via Getty Images) ILLUSTRATION - A Bitcoin is photographed during the 'Bitcoin Exchange Berlin' at the Betahaus in Berlin, Germany, 24 November 2013. The 'Bitcoin Exchange Berlin' is an offline exchange for Bitcoin trade that takes place monthly. Photo: JENS KALAENE | usage worldwide (Photo by Jens Kalaene/picture alliance via Getty Images)

CoinMarketCap’s figures show that Ethereum, which ranked second behind bitcoin in the market, has slumped from its July high of $317 (£255) to today’s price of $217 (£175).

Ripple, a banking-focused cryptocurrency that sits third in the rankings, has also endured a difficult month. It’s currently valued at $0.31 (£0.25), down from the month’s high of $0.41 (£0.33), the ranking site says. 

What caused prices to tumble?

The losses appear to have occurred shortly after a hearing where David Marcus, president of messaging products at Facebook, fielded questions about the social media giant’s upcoming cryptocurrency, called Libra, from US lawmakers.

According to The Independent, one of the senators told Marcus that Facebook was “delusional” to believe people would trust it with their money, while another said the company’s agenda promotes “flagrant displays of bulls***”.

PARIS, FRANCE - DECEMBER 05:  In this photo illustration a man holds a visual representation of the digital Cryptocurrency Bitcoin in front of the offices of the bank 'La Maison du Bitcoin' on December 05, 2017 in Paris, France. The value of the electronic money, Bitcoin has increased tenfold since the beginning of the year, and the price of Bitcoin has exceeded 10,000 US dollars. The value of Bitcoin rises and rises, but an investment risk remains.  (Photo by Chesnot/Getty Images) © 2017 Chesnot PARIS, FRANCE - DECEMBER 05: In this photo illustration a man holds a visual representation of the digital Cryptocurrency Bitcoin in front of the offices of the bank 'La Maison du Bitcoin' on December 05, 2017 in Paris, France. The value of the electronic money, Bitcoin has increased tenfold since the beginning of the year, and the price of Bitcoin has exceeded 10,000 US dollars. The value of Bitcoin rises and rises, but an investment risk remains. (Photo by Chesnot/Getty Images) Other senators, meanwhile, raised concerns about the cryptocurrency being exploited by “criminal organisations to facilitate money laundering, or even finance terrorist activities”, the news site says. 

The hearing appears to have “spooked” bitcoin traders, the Daily Express says, prompting mass sell-offs that saw the cryptocurrency’s value plummet. 

Can values recover?

Possibly, but the next few days could be crucial for the virtual coin.

If bitcoin values are able to surpass and - critically - stay above the $10,000 mark over the next few days, the bull run that has propelled the digital currency throughout the year may be back on track, says cryptocurrency news site CoinDesk.

But all signs point to a “bearish” trend, the site adds, with prices looking set to slide as the month comes to a close.

More on Bitcoin price: what caused values to crash?

AdChoices
AdChoices

More from The Week

image beaconimage beaconimage beacon