Bitcoin price (BTC) extended the downward trend for a third day on Wednesday; the new wave of volatility was supported by regulators – who are planning essential steps to cull fraud and illegal activities from cryptocurrencies. The U.S. SEC will now only allow registered cryptocurrency exchanges to operate, and they will clamp down on all the unregulated exchanges.
The U.S. Securities and Exchange Commission warned investors to stay away from unregulated exchanges, as these exchanges can do anything they want.
Registering Cryptocurrency Exchanges Would Reduce Uncertainty
Regulating digital currencies and keeping a strict eye on ICO’s could help in building traders confidence. Unfortunately, the announcement hasn’t been applauded by crypto traders – bitcoin and other digital currencies are declining at a robust pace after the SEC issued the warning yesterday.
Bitcoin price fumbled below $9,500 today, down almost $2,000 from Monday’s high of $11,500. Ripple prices fell below $0.90 for the first time in the last thirty days. Ethereum (ETC), Bitcoin Cash (BCH) and the rest of the digital currencies are declining at a low to high mid-single-digit rate.
“If a trading platform lets people buy and sell cryptocurrencies that are considered securities — basically, something you can invest in — then they must register with the SEC as an exchange”, the SEC said Wednesday.
Market analysts have had stressed for the interference of regulatory authorities to streamline trading activities in crypto exchanges – which had at one stage surpassed the total market capitalization of $850 billion. The SEC announcement continues to generate the positive response from the crypto exchanges that are looking to run trading activities legitimately.
“We applaud the SEC’s statement today – the trading of ICO tokens that are unregistered securities on unlicensed exchanges has gone on for far too long,” Cameron Winklevoss, President of bitcoin exchange Gemini. “This is dangerous for consumers and bad for the cryptocurrency ecosystem as a whole.”
But Why Are Prices Falling?
Though market analysts and traders are applauding the news, bitcoin price fumbled on the report of working under the rules of the SEC; the downward trend indicates the significant trading volume from illegal transactions – which accounts for almost half of the total volume based on analysts research reports. Besides from the United States, regulators from Europe and other key regions are formatting their plans to make it difficult for criminals to use digital currencies for illegal purposes.
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