Bitcoin declined for a fifth day, breaking below US$7 000 for the first time since November and leading other digital tokens lower, as Lloyds Banking Group joined a growing number of big credit card issuers halting purchases of cryptocurrencies on their cards.
The biggest digital currency sank as much as 18% to $6 985 as of 1.12pm in New York, according to composite Bloomberg pricing. On South Africa’s Luno exchange, it was trading at R87 905 at 8.45pm local time. It has erased almost 65% of its value from a record high $19 511 in December. Rival coins also retreated on Monday, with ripple losing as much as 17% and ethereum and litecoin also weaker.
Bitcoin’s longest run of losses since Christmas has coincided with investors exiting risky assets across the board, with stocks globally retreating in the wake of a slump in US markets Friday. Bitcoin so far seems to be struggling to live up to any comparison with gold as a store of value, which is an argument made by some of its supporters. Bullion edged higher as other safe havens — the yen, Swiss franc and European bonds — also gained.
Weeks of negative news and commercial setbacks have buffeted digital tokens. A growing number of big credit card issuers have said they’re halting purchases of cryptocurrencies on their cards, including JPMorgan Chase & Co and Bank of America. Several cited risk aversion and a desire to protect their customers.
Meanwhile, North Korea is trying to hack South Korea’s cryptocurrency-related programmes to steal digital currencies and has already stolen tens of billions of won worth, Yonhap News reported. And authorities in digital-coin powerhouse South Korea and other countries are weighing increased regulatory scrutiny of the industry, news which helped spark the ongoing selloff.
China will block all websites, including foreign platforms, related to cryptocurrency trading and initial coin offerings in an attempt to finally stamp out speculation in the market, according to the South China Morning Post. — Reported by Todd White and Eric Lam, with assistance from Jan-Henrik Förster and Eddie van der Walt, (c) 2018 Bloomberg LP