The quick read: It was a bad day at the office for cryptocurrencies Tuesday. Bitcoin fell more than 19 percent and traded for below $11,000 for the first time since December while Cboe bitcoin futures fell 20 percent, temporarily halting trading. (CNBC) Ethereum prices dropped by more than 20 percent as well while Ripple prices plunged by a third. (Reuters)
The key facts: Turmoil in South Korea and China are roiling the crypto markets. Concerns about a potential government crackdown on cryptocurrency trading in South Korea are ongoing. China added to the worries this week by signaling new actions against exchange-like services trading cryptocurrencies. (China made cryptocurrency exchanges illegal last year.)
China is escalating its clampdown on cryptocurrency trading, targeting online platforms and mobile apps that offer exchange-like services, according to people familiar with the matter… The government plans to block domestic access to homegrown and offshore platforms that enable centralized trading, the people said, without being more specific about how policy makers define such platforms. (Bloomberg)
The bottom line: Bitcoin and other cryptocurrencies are not immune to market forces — including government actions. With more countries moving to scrutinize crypto markets, future disruptions are likely.