Late Monday and early Tuesday saw a considerable crash in almost all the major crypto currencies with the minor ones also deeply affected. Tuesday morning saw the price of Bitcoin crash to around $12,300 from highs of just over $14,000 merely a few hours before as investor sentiment seemed to take a massive dip. The same could be said for Ripple which continued dropping by as much as 20% at one point to trade well below the $1.50 mark and was dropping even further at press time. In fact the XRP crypto currency declined even further as the morning progressed and was trading at $1.35-1.40, almost 150% down from its all-time high of $3.50 a few weeks ago.
Other major crypto currencies which suffered a considerable decline were Ethereum Classic and Dash which suffered 10-20% drops and even more at one stage with the correction appearing to continue well into the day. Bitcoin Cash also suffered a massive drop of close to 20% with its value declining to below the $2,000 mark for the first time in several weeks. Litecoin also suffered terribly and the price went down dangerously close to the $200 mark with investor sentiment dropping further as the news from China on stricter regulation appeared to kick in.
Smaller and less traded altcoins also took massive hits to their prices overnight. Cradno went down by 11% whilst EOS and IOTA also suffered double digit drops. This caused the total market cap of crypto currencies to decline considerably and at one point the value was below $600 billion and still going down. Many users have been querying the huge losses in value over the past few hours and are pointing their fingers at the bad news that emanated from the South Korean and Chinese markets which had a disastrous effect on crypto currency prices in the short term.
The only exception in this complete bloodbath was the Chinese based NEO coin which surged by almost 25% to an all-time high of $180 in the past 24 hours. Many are observing this as a vote of confidence in this relatively new coin which is also called the Chinese Ethereum for various reasons.
Cryptocurrencies with lower market caps, specifically cryptocurrencies outside of the top 10 global rankings, have recorded larger losses than established digital currencies like bitcoin and Ethereum. Even cryptocurrencies with trading volumes heavily concentrated in South Korea such as Qtum and EOS have declined in value, even though the South Korean cryptocurrency market recovered from the latest trading ban fiasco.
Apparently, the recent correction of the cryptocurrency market was not triggered by South Korea or China, as the market have already recovered from the FUD produced by the authorities in both regions. Rather, it is likely that the major correction was caused by the abrupt surge in the market valuation of most cryptocurrencies in the market within a short period of time, with minor corrections. Prices have now come down to more realistic values perhaps with investors now more likely to take a dip into the market at these cheaper prices.
Within the past 30 days, the market valuation of cryptocurrencies increased from $540 billion to $840 billion, with several cryptocurrencies such as Tron that do not have enough users, decentralized applications, and user activity to justify their market valuations, surging by billions of dollars. Several billionaire investors such as Warren Buffet and JP Morgan CEO Jamie Morgan have also been pillorying Bitcoin and the crypto currency market with the resultantly negative effects on the prices of these coins.