Bitcoin Tumbles, Called Potential 'Threat To Financial Stability'
(Kitco News)- The cryptocurrency marketcontinues to get hammered with selling pressure, with the bitcoin -- the mostpopular digital currency -- falling to fresh multi-month lows as moreregulators call for more oversight.
Overnight, Agust?-n Carstens,general manager for the Bank of International Settlements, warned thatcryptocurrencies are becoming a “threat to financial stability.”
“There is a strong case forpolicy intervention. As now noted by many securities markets and regulatory andsupervisory agencies, these assets can raise concerns related to consumer andinvestor protection. Appropriate authorities have a duty to educate and protectinvestors and consumers, and need to be prepared to act,” Carstens said in aprepared statement.
“Most importantly, the meteoricrise of cryptocurrencies should not make us forget the important role centralbanks play as stewards of public trust. Private digital tokens masquerading ascurrencies must not subvert this trust. As history has shown, there simply isno substitute,” he added.”
The comments helped to pushbitcoin prices to a session low of $6,000, according to Kitco.com aggregatedmarkets. The digital currency, while off its lows, continues to trade at itslowest level since mid-November. Bitcoin last traded at $6,939.
Looking at the technical picture,Lukman Otunuga, research analyst at FXTM, said that the bitcoin market is“unquestionably” bearish.
“There have been consistentlylower lows and lower highs while prices have crossed below the 200[-day] simplemoving average. Sustained weakness below the $8,000 resistance level mayencourage a decline back towards $6,000 and $5,000, respectively,” he said.
Jim Wyckoff, senior technical analystat Kitco.com, agreed that there could be more selling in the near term, but saidthe market is starting to look a little oversold.
“The bulls are throwing in thetowel and abandoning ship. Such a condition is usually the final stage of amajor bear market,” he said.
For Kitco News
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