Both Bitcoin and other altcoins have recorded fast and significant declines in the last several hours. Is this a crisis in the cryptocurrency industry?
The declines were, first and foremost, sudden. On August 28, in less than an hour, Bitcoin's value declined by nearly $600. As for now, the decline continues. Altcoins have experienced similar declines (from 6 to even 10 percent). Each of the leading cryptocurrencies on the markets has been lit red since the opening of Thursday's session.
Quite a big dispute was caused by the case of XRP, as many investors complained about Ripple. In their view, the company is consistently dumping coin, which , for them, is the reason for XRP's stagnation. In this case, there is also a dispute with one of the investors who intends to fork on XRP.
In addition, the total cryptocurrency market cap dropped by nearly $22 billion in 24 hours.
Is this a crisis?
It is hard to explain what caused such rapid declines at that particular moment. It may be a result of a debate about Chinese cryptocurrency, which could have a huge impact on Bitcoin. All this also happens in the shadow of the trade war between the US and China.
The termination of CME Bitcoin Futures may be another reason. On August 27, it was announced that at the end of this week half of the open positions operating on this market would expire.
Closing was usually associated with high price volatility. The biggest players probably predicted Bitcoin's decline knowing about the CME case. The forward contracts market will probably not be as monopolized anymore due to the launch of Bakkt, scheduled for September 23.