Bitcoin [BTC], the biggest cryptocurrency by market cap, continues to be the talk of the town. However, the cryptocurrency which was making buzz to the news related to the regulators and the ETF, is now up in the lights because of its price. The coin has been seeing a continuous downfall in the market, showing no signs of hitting the stop button.
The coin has also lost a huge chuck of its market cap, hitting its all-time low for the year by breaching the $80 billion mark. According to CoinMarketCap, Bitcoin is trading at $4481.01 with a market cap $77 billion. It has a trading volume of over $6 billion and has plunged by 24.06% in the past seven days.
Bart Smith, Head of Digital Assets at Susquehanna International Group, spoke about the possible reason behind Bitcoin’s price fall and whether it has found its bottom, in an interview with CNBC Fast Money.
He stated that there were a few factors which led to Bitcoin trading at this rate. The first reason is the on-ramp for new capital being very difficult. Smith added that it is still very difficult to buy Bitcoin the way they want to in the west from their global institutions. He said that a wealthy individual prefers to invest through Fidelity or Bank of America than invest in a cryptocurrency exchange that request for an image of their drivers license.
Smith went to say that this has resulted in the second problem, the inadequacy of liquidity. He added:
“And so we’ve seen kind of a stable price all summer we talked about it on the show. It was at $6,000, give or take, but volatility got a really, really light at the end of October”
He further spoke about the recent Bitcoin Cash hard fork, which was the in the limelight because of the drift in the community. Smith stated that this split does not necessarily create a tremendous amount of confidence. He said:
“When those sellers come in, there’s just no liquidity to absorb it. So without these on-ramps, that hopefully with Bakkt and Fidelity and further regulation in 2019, there’s not going to be capital to soak it up and so when you have sell-offs like this, you can absorb it.”
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