In 2017, anything related to Blockchain and cryptocurrency was hot property; in 2018, anything linked with blockchain is having a difficult time.
Last year, about 170 hedge funds began trading; while in 2018 only 20 new funds have started so far. Additionally, chances are 10 percent of the existing funds will close operations this year, due to regulatory uncertainty and market conditions.
Even the stock market had joined the frenzy last year when stocks of companies, joining the Blockchain craze, saw their price skyrocket. 2018 has been the exact opposite, with most of those stocks plunging.
Prices drop when authorities threaten to step in, evidenced when last year’s lowest price fell to $6,127.21 amid threats from China. Again, the trade war raging between Trump’s US and China seems to be affecting all markets, not just cryptocurrency.
A market-wide drop in price was also seen when the news broke that Facebook is to drop all adverts for cryptocurrencies. The news rocked the market more than expected, and it is hard to see a way up with a main source of advertising gone.
However, with the election of Yi Gang as the head of People’s Bank of China (PBoC), the country’s central bank, some market experts believe that the Chinese ban on cryptocurrency trading might be overturned.
South Korean regulators are also finalising the taxation framework for cryptocurrencies and will most likely throw some light on the probability of a full-scale regulation of the cryptocurrencies after mid-June.
Furthermore, the Mayor of Seoul has announced the creation of ‘S coin’, the cryptocurrency of the city. He also wants to encourage the development of Blockchain projects as he foresees the widespread use of the technology in the city.
Presently, having rallied more than 50 percent this month, Bitcoin is now witnessing a pullback. The cryptocurrency rose to $9,767 on Bitfinex yesterday – the highest level since March 12 – before falling back to $9,100.
At time of writing Bitcoin has fallen further, currently sitting at $8,748.75.
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