Impact of Upbit raid on the cryptocurrency market

All the cryptocurrencies in the market suffered from great decline following the Upbit raid which took place recently. These widespread declines have taken place after it was reported that South Korean authorities raided Upbit, nation’s largest digital currency exchange. Widespread losses were experienced by the entire market and all the top 25 digital currencies were in red at the time of writing.

While Bitcoin had fallen 8.2% over the last 24 hours, several major cryptocurrencies had suffered losses close to twice that high. Stellar [XLM], Cardano [ADA] and EOS, for example, were all down at least 16%. Ripple’s XRP token and Bitcoin Cash [BCH], had dropped by 12.8% and 13.8%, respectively.

Several analysts confirmed that the Upbit raid was the driving force behind today’s crypto losses.

Digital currency investor Marius Rupsys says:

“The main reason seems to be Upbit news. Most are talking about it and if you look at prices in Korean exchanges, they are leading the drop.”

This isn’t the first time that South Korean raids have caused crypto prices to fall, emphasized Joe DiPasquale, CEO of cryptocurrency fund of hedge funds, BitBull Capital.

He noted that:

“The last time South Korea raided their ‘top exchanges’ was on January 10th, and Bitcoin’s spot price saw a -7% decline on intraday trading that day as well.”

Further, he added:

“As is so often the case, an event that should rightfully cause turbulence in a specific region seems to be creating shockwaves globally. The Upbit raid is not the first of its kind, and the markets overreacted in past similar instances as well. As the market continues to mature, these events should grow fewer and farther between, and investors will grow a thicker skin.”

Bitcoin was able to hold up better than many other digital currencies because it is more established than its peers, claimed several analysts.

Shone Anstey, president, and co-founder of Blockchain Intelligence Group stated:

“BTC is the anchor crypto that all other cryptos are tied to in terms of price. Bitcoin is the most stable and dominant cryptocurrency with the largest network effect. Bitcoin is the one to watch, since if it fails they all fail.”

Time will tell if this negative blow will further decline the prices of BTC and other cryptocurrencies, or if the ongoing Blockchain Week in New York will bring back a bull market.

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