With news sites flooding the internet with headlines about the supposed ‘burst’ of the speculative cryptocurrency bubble, a tenuous recovery is holding. Bitcoin as well as most altcoins sustained steep losses this week. Bitcoin dipped below $10,000 USD on Tuesday, finding itself below 5 figures for the first time since November 30th, 2017. At press time, the overall cryptocurrency market capitalization is sitting at a $554 billion USD, or just over 33% down on this year’s all-time high of $820 billion USD.
Ripple One of the Biggest Losers
Bitcoin’s Slip was steep, but Ripple’s was even steeper. XRP lost its position as the number 2 coin by market cap and slipped to a low of $0.9 USD on January 17th, after an all-time high of $3.79 USD just 2 weeks prior. Ethereum, which overtook Ripple to regain its #2 position in the rankings by market cap, is back up to $1000 USD per unit.
Ripple Experiences a Tragic Fall – Chris Larsen Loses Billions Overnight
As of Wednesday 17th, Ripple officially fell more than 75% from this year’s all-time-high causing many well-known figures to lose significant amounts on paper. At current prices, Chris Larsen, the billionaire co-founder of Ripple is no longer worth $59.9 billion USD. The former Executive Chairman now holds approximately $16 billion USD in XRP. Following XRP’s bullish run earlier this month, Larsen shot up to become the fifth richest individual on the Forbes’ list, surprising many who haven’t yet heard of him or his creation. The Winklevoss brothers, who reportedly held XRP in excess of $1bn USD at peak values, were also affected.
Exogenous Forces at Play
Regulatory issues surfacing in Korea and China are contributing to the change of momentum. A large influx of less knowledgeable investors in the space, who may not know the intricacies of these markets, might also be adding to the volatility. Nevertheless, Ripple should be expected to recover, as most other cryptocurrencies. XRP has announced important deals with banking and financial institutions that should encourage the newer investors to pour their funds into it once again.
BitConnect Pulls the Plug and Announces Shut-Down Amidst Market Scare
Another important story to follow during this recent slump, is the BitConnect controversy. BitConnect is officially shutting down. The company that has been labeled as a scam by many, is facing legal action. A spokesperson of the company reportedly said they received multiple cease-and-desist notices from financial bodies in the United States, including the Texas State Securities Board, as well as the Securities division of North Carolina’s Security of State. The official charges include:
- Fraud along with misleading investors;
- Red-flag due to ‘guaranteed annual compounded returns in excess of 3,000%’.
This isn’t the first time BitConnect is under fire. The company was considered to be one of the notorious new-age Ponzi schemes of the cryptocurrency era. Following the news, BitConnect’s coin dropped to under $40 USD from a year-high of $363.62 USD. This coin is probably one of the few that will not make a comeback, and will not be part of this tenuous recovery.