Investment apathy in global cryptocurrency markets and also traditional markets deepened over the weekend as Bitcoin price which has been sliding in recent times slipped below the normal psychological $7,000 which everyone within the crypto space has been looking forward towards as a support for one last rally towards the end of this year. Apart from Bitcoin, all other cryptocurrencies are also down as well indicating a market malaise which hasn’t occurred in quite a bit.
Ethereum lost almost 10% over the last 24 hours, XRP lost 8.45%, Litecoin, Binance Coin, Bitcoin Cash also lost 8-10% of their value.
This price drop comes at a time when tensions between the United States and the People’s Republic of China concerning trade have reached new lows following the recent comments by Robert O’ Brien who is the U.S. National Security Adviser (NSA) on Hong Kong. He indicated that President Donald Trump won’t turn a blind eye to the ongoing Hong Kong situation. This, of course, didn’t go down well with not only cryptocurrency investors but also with investors in traditional markets as well.
S&P 500 index went up by 0.2% finishing at 3110.29 points while the Dow Jones Industrial Average was up by 0.39 % at 27,875.62 points, and the Nasdaq Composite was also up by 0.16 %, at 8519.88 points indicating market lethargy and reluctance for new inflows across the board showing intense dislike for the current trade impasse between the Chinese and American governments.
This also indicates that there are no capital transfers from traditional markets to cryptocurrency markets as the reverse has been the case in recent times when chaos due to geopolitical and trade issues have caused investors to move the capital from the traditional markets to the cryptocurrency markets which have been seen as a hedge against traditional market volatility.
This also indicates that the cryptocurrency market is maturing and several other factors are at play at the moment which are hidden in plain sight.
Firstly, cryptocurrency markets are correcting themselves after the Chinese President Xi Jinping encouraged his people to pay close attention to blockchain technology. Bitcoin and cryptocurrency prices rose by more than 30% in response to the news. This also was followed by several moves by the Chinese government to introduce measures that will spur blockchain technology and adoption.
However, the Chinese government hasn’t changed its stance on the strict regulation of cryptocurrencies even though they are set to launch their national cryptocurrency next year. The market’s response is based on several factors at play at the same time which includes the recent U.S.-China trade war, lack of resolution of the Brexit issue and overall apathy towards cryptocurrencies tokens as indicated by several governments has slowed the expected Bitcoin market rally and exponential increases in the market capitalization of the crypto space.
Even though cryptocurrency prices are sliding in tandem with traditional markets, it is highly unlikely that this will continue because being one of the few times that this occurred based on certain fundamental factors may not reoccur again after the correction that cryptocurrency prices are currently undergoing.
Christopher Haruna Hamman is a Freelance content developer, Crypto-Enthusiast and tech-savvy individual. He is also a Superstar Content Developer, Strategy Demigod, and Standup Guy.
