It hasn’t been a great week for crypto.
Over the past seven days, the blockchain industry has lost almost $70 billion thanks to the market-wide crypto onslaught. Ripple (XRP) was one of the few coins that succeeded in keeping the losses to a minimum, while Bitcoin Cash (BCH) crashed the hardest of the top 10 cryptocurrencies.
Since November 14, the crypto bear period has pushed most digital coins down by 30 percent in value. BCH felt the impact the hardest, losing over 50 percent by November 20. On the other hand, XRP successfully defended its price thanks to Coinbase’s Custody program. While BCH’s hard fork was the biggest factor in market’s current downfall, analysts have pinpointed fake news as another problem for the industry.
Crypto onslaught – Market cap down to $140bn
On November 14 (UTC +2), crypto market started crashing. The overall value of the industry dropped from $209.42 billion down to $141.4 billion on November 20. Practically all cryptocurrencies lost around 30 percent of their value during those seven days.
The number of Bitcoin transactions rose from 239,000 on November 18 to around 278,000 on November 19. This is due to an increased number of BTC sell orders, which further dropped its value to the lowest point ($4,744) since October 2017. Through its market power, BTC dragged the altcoins down with it.
It seems the BCH mining war has created a lot more negativity within the market than analysts expected. BCH suffered a debilitating drop in value of more than 50 percent – from $515 on November 14 down to $200 this morning. The war between BCHABC and BCHSV has influenced traders to sell digital assets across the board, pushing the market into full-blown crypto bear mode.
Based on data from CoinMarketCap, it seems XRP is the sole weekly “winner” of the top 10 cryptos. XRP held firm during the onslaught, losing less than nine percent of its value, leaving it lingering around $0.45. Most analysts see Coinbase’s Custody program as the main reason why XRP now holds second place in the industry. Apparently, the integration of XRP into the system helped crypto reach institutions, giving XRP certain level of safety, while the rest of the market declined.
Miners opt for Bitcoin ABC
Although the crash affected the entire industry, BCH felt the pain the hardest. The ongoing war between Roger Ver’s Bitcoin Cash ABC and Craig Wright’s Bitcoin Cash SV is to blame for that.
Now, Bitcoin.com mining pool users are pushing for Bitcoin Cash ABC through new cloud mining services. Users would “purchase” hash rates, while those who wish to choose the SV network would need to leave the pool.
The Kraken platform also announced its support for the ABC coin, limiting the minority Bitcoin Cash SV (BCHSV) chain even further. The platform explained the move by saying: “Bitcoin Cash SV does not presently meet Kraken’s listing requirements and is unlikely to be supported.” That means the exchange may not credit BCH holders with BCHSV coins. Furthermore, while SV had strong support at the beginning of November, its overall mining pool share has now dropped to 58 percent.
Fake news not helping during the crypto bear market
Although BCH’s fork was the main cause of the crypto bear trend, analysts have also pointed the finger at the fake news for compounding the problem. Rumors suggested Nvidia’s recent problems were due to the decline of the crypto market. However, CNBC Mad Money’s Jim Cramer said the company’s stock price decline was due to poor overall revenue forecasting.
Even though the crypto industry lost almost $70 billion during the week, experts think this development is temporary. Most agree that adoption and further development of large-scale projects will bring the market’s value back up. The arrival of Bakkt and newly-formed Swiss startup Amun’s multi-crypto exchange-traded product (ETP) could help the industry win back its value.
While we all wait for the bounce and promising projects like Bakkt and Amun to come to life, the million dollar question still remains: “Where is the bottom.”