Bitcoin, Ethereum Plunge As Sell-Off Smashes Crypto Sector

Bitcoin, the biggest and best-known cryptocurrency, had already been under pressure from a series of tweets from Tesla's Elon Musk, but the news from China sent it further down

Bitcoin and ether tumbled on Wednesday to 3-1/2 month lows, on track to post their largest one-day loss since March last year, in the wake of China's move a day ago to ban financial and payment institutions from providing cryptocurrency services. At one point during the meltdown, nearly $1 trillion was wiped off the cryptocurrency's market capitalization. In late morning trading, the market cap was at $1.65 trillion, according to data tracker CoinGecko.com. Bitcoin, the biggest and best-known cryptocurrency, had already been under pressure from a series of tweets from Tesla boss Elon Musk, but the news from China sent it further down, It hit a 3-1/2-month low of $30,066. The cryptocurrency has dropped 54 per cent from a record high of $64,895 hit on April 14. It is also heading for its first monthly decline since November 2018. "Bitcoin's sharp price drop should come as no shock to the market," said Gavin Smith, chief executive officer of crypto consortium Panxora. "Any asset which has risen as much as bitcoin over the past year can be expected to have pullbacks as some investors withdraw profits, like we're currently seeing. While often a brilliant investment opportunity, traders must remember that Bitcoin is still an emerging asset class and will continue to experience large price swings," he added.