The price of bitcoin — along with almost all other mainstream cryptocurrencies — is in free fall.
Sentiment has switched this year, after 2017’s bull run with the price down some 40 percent in 2018 and a whopping 20 percent in just three days.
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This week Facebook banned advertisements for cryptocurrencies and initial coin offerings (ICOs) amid concerns they were being used to mislead potential customers.
In a blog post Facebook’s product management director Rob Leathern wrote:
We want people to continue to discover and learn about new products and services through Facebook ads without fear of scams or deception. That said, there are many companies who are advertising binary options, ICOs and cryptocurrencies that are not currently operating in good faith.
Meanwhile, the US Securities and Exchange Commission accused AriseBank and its co-founders of perpetrating an “outright scam” in an initial coin offering that purportedly raised $600m from investors.
The total market capitalisation or value of all cryptocurrencies in circulation stood at $405bn this morning, down $112.6bn from yesterday, according to CoinMarketCap.com data.
Other major coins including ethereum and ripple were down 22 percent and 32 percent on yesterday.
In Asia, where large volumes of bitcoin and other cryptocurrencies are now traded, the news this week has been mixed.
Officials from Japan’s Financial Services Agency have raided the offices of Coincheck, a cryptocurrencies exchange, to monitor its response to the biggest ever bitcoin theft.
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However, South Korea is not planning to ban cryptocurrency trading, the country’s finance minister Kim Dong-yeon announced yesterday.
Several senior South Korean government figures recently hinted that a complete ban on cryptocurrency exchanges was under consideration.
There is no intention to ban or suppress cryptocurrency [market].
The ICO market — where startups issue their own digital currencies — exploded last year. These tokens can be traded online despite the company being private, are sold for real money that startups then use to fund their projects.
The fundraising method, first pioneered by Ethereum in 2014, was little used up to the start of this year but it has been widely taken up in 2017, eclipsing venture capital as a means of raising money for blockchain startups.
Over $3.5bn was raised through ICOs last year, according to data from Off3r.