A number of factors have weighed on the price of cryptocurrencies.
The first major one was selling by the trustees of collapsed Japanese cryptocurrency exchange Mt.Gox. It closed in 2014 and filed for bankruptcy after losing around 850,000 bitcoins. Its founder Mark Karpeles, recently pleaded not guilty to charges of embezzlement.
A trustee of the now-defunct exchange has been selling large amounts of bitcoin that the exchange still had to pay back creditors. This has been hitting the price of bitcoin.
Meanwhile, Alphabet-owned Google, the world’s largest digital advertiser, announced it was banning cryptocurrency-related advertising, including initial coin offerings (ICOs), wallets and trading advice.
“The sell-off was triggered by a number of factors, notably, weariness over increased regulatory scrutiny of ICOs, the Mt.Gox bitcoin dump and what seems to be some heavily liquid traders pushing for future buy-back opportunities,” Thomas Glucksmann, head of APAC business development at cryptocurrency exchange Gatecoin, told CNBC by email on Thursday.
“These bear signals have subsequently spooked many new crypto investors who are now looking to cut their loses.”