Crypto currencies drop on SEC’s calls for tighter regulationwritten by Bella Palmer
The value of the entire cryptocurrency market was down 3.8% over the last 24 hours, according to data provider CoinMarketCap.com
Bitcoin's (BTC-USD) recent rally faded on Tuesday morning, as investors responded to news that the US Securities and Exchange Commission (SEC) wants tighter regulation for the crypto currency sector.
Gary Gensler, who took over the top financial watchdog in April, told Bloomberg in an interview published on Tuesday that he wanted more regulation of cryptocurrency in order to protect consumers.
If somebody wants to speculate, that’s their choice, but we have a role as a nation to protect those investors against fraud, Gensler told the news wire, saying he was specifically targeted cryptocurrency exchanges for regulation.
Bitcoin was down 3.8% to $38,587 at just before 9 am in London. It marked a return to levels seen last Friday, before a weekend rally that saw bitcoin push above the symbolic and closely watched level of $40,000.
Other cryptocurrency prices were also under pressure on Tuesday morning. Ethereum (ETH-USD) was down 4.5% to $2,488 and XRP (XRP-USD) was 5% lower at $0.71. The value of the entire cryptocurrency market was down 3.8% over the last 24 hours, according to data provider CoinMarketCap.com.
Naeem Aslam, chief market analyst at Avatrade, pinned the price declines on Gensler's comments.
He has made it clear that he wants to protect investors and that means more regulation, Aslam said. Of course, the entire concept of Bitcoin and most of the other crypto currencies is to ward off regulatory burden.
The fact is that the crypto world has changed substantially. We have institutional players who are making big moves every day. Protecting consumer and investors is the right step.
Regulators around the world have recently clamped down on crypto exchanges, a central part of the ecosystem. Exchanges such as Binance and DeFi have been forced to make changes such as limiting leverage and withdrawals.
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