Bitcoin plunged as much as 10 percent on Tuesday, sinking below $4,500 and deepening a broad selloff that has wiped out roughly 30 percent of its value in a week. The move marked another sharp leg lower in a market already under pressure from fading investor confidence.
The Reuters report said the decline came after bitcoin had spent several months hovering near $6,500 before momentum broke earlier in November. By Tuesday, the cryptocurrency was changing hands at $4,354.20 on Bitstamp, its weakest level on that exchange since October 2017.
Other major digital currencies were hit as well. Ether fell 10 percent, while Ripple’s XRP dropped 13 percent in a slide that traders largely described as sentiment-driven.
“The euphoria has died and prices have consolidated with lower lows and lower highs. A lot of people have lost interest,” said Fawad Razaqzada, an analyst at Forex.com.
The drop also tracked weakness in wider financial markets, with European shares falling after a steep decline on Wall Street. Some traders pointed to concern over a “hard fork” in bitcoin cash as an added source of unease, arguing that disruption in the smaller split-off currency could spill over into the rest of the crypto market.
Bitcoin’s latest retreat leaves it down about 75 percent from its December peak. Reuters noted that a regulatory clampdown on cryptocurrency trading in early 2018, together with weakening investor appetite, had accelerated the rush for the exits.
Despite the rout, cryptocurrency supporters maintained that volatility is part of the market and argued that virtual currencies operating outside the banking system would survive short-term price shocks. According to Coinmarketcap.com, the total market value of virtual currencies had fallen below $150 billion from about $800 billion in January 2018.
The second and third largest cryptocurrencies, XRP and ether, were trading at $0.4451 and $133 respectively on the Luxembourg-based Bitstamp exchange.
