After another upsurge yesterday, the bitcoin price again plunged today. The most popular cryptocurrency sank below $14,000 having shed over 7% in the Asian trade. One of the striking features of the cryptocurrency market is non-stop trading. Traders have to keep track of the latest news day and night, seven days a week. The Christmas and New Year holidays are no exception. Besides, analysts say that bitcoin trades with the highest volatility on Thursday and Friday. Bitcoin’s dynamic today proves the fact.
The global trading day started with massive sell-offs of cryptocurrencies in response to the news from South Korea. The monetary authorities announced that one of the largest domestic cryptocurrency exchanges is facing bankruptcy. South Korea is ready to introduce tougher measures to crack down on cryptocurrencies trade. Transactions on cryptocurrency exchanges account for over 20% of the total trade volume. One of such measures is to establish a supervisory agency that will impose restrictive rules and regulations.
Besides, traders are absorbing other market moving news. President Donald Trump endorsed a bill imposing a new tax on virtual currencies. From January 1st, transactions of exchanging cryptocurrencies for cash as well as exchange of one digital currency for another will be subject to taxation. Accounting to the new law those who hold cryptocurrencies for at least one year will have to pay a tax from 10% to 37% depending on individual income. Considering these specifics, a lot of traders rushed to exchange one cryptocurrency for another, aiming to delay a tax payment for long possession of such assets until a 1-year term does not expire.
The second cryptocurrency in terms of capitalization, ethereum, also dropped in value to trade below $700 per coin. To sum up, global central banks intend to curb speculations with cryptocurrencies, thus making them less popular among investors. Experts say that after a series of corrections, we will eventually see a genuine price of bitcoin.
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