Cryptocurrency prices today: Bitcoin down 2%; Ethereum, Dogecoin & Stellar fall up to 3.5%

Cryptocurrency prices today: Bitcoin down 2%; Ethereum, Dogecoin & Stellar fall up to 3.5%

World’s largest traded cryptocurrency bitcoin fell nearly 2% today a day after it crossed the $50,000 mark since three months. On Coinmarketcap, the price of bitcoin fell 1.86% to $49,259.

Market cap of the cryptocurrency slipped to $926.156 billion.

Bitcoin has risen 69.51% since the beginning of this year. Currently, the global crypto market cap stands at $2.14 trillion, 0.80% lower over the last day.

Other cryptocurrencies were also trading in the red today.

Ethereum declined 0.73% to $3,328 and Dogecoin lost 3.53% to $0.313. Digital token Stellar fell 1.93% to $0.3732 and XRP was down 1.43% to $1.22.

Litecoin declined 1.72% to $185.81 and Uniswap fell 2.10% to $28.73.

Of late, crypto prices have risen on the back of comments from billionaire Elon Musk and Ark Investment Management LLC’s Cathie Wood.

In late July, Elon Musk said Tesla was “most likely” to start accepting bitcoin as payment again. The comment helped the cryptocurrency race past the $30,000 level. The electric carmaker said in May that it would no longer accept the cryptocurrency for purchases.

Bitcoin surges above $50,000 for first time in three months

Bitcoin broke back above $50,000 on Monday for the first time in three months as investors piled back into the cryptocurrency on bargain-buying. The largest cryptocurrency by market capitalization, reached as high as $50,152.24, the highest since mid-May, up 2.5%.

Bitcoin has recovered after trading in a range of about $30,000 to $40,000 for many weeks, after it plunged from a record near $65,000 in mid-April. Still, it’s up significantly in the past year.

As per CoinDesk, Ether, the coin linked to ethereum blockchain and the second largest crypto, surged to $3,321. Dogecoin, on the other hand, was trading at $0.32, up 1%. Other digital coins like Stellar, Uniswap, XRP, Litecoin, Cardano also were trading with gains over the last 24 hours.

The worldwide crypto adoption grew by 880% between June 2020 and July 2021, according to the 2021 Global Crypto Adoption Index by blockchain data platform Chainalysis. India ranks second in terms of crypto adoption worldwide behind Vietnam, but ahead of countries such as the US, UK, and China, as per the report.

Before the rebound over the past few weeks, the crypto sector had been weighed down by a crackdown in China and worries over the environmental impact of the energy needed to create coins and process transactions. Supportive comments from billionaire Elon Musk and Ark Investment Management LLC’s Cathie Wood had helped Bitcoin rally.

In another news, PayPal Holdings Inc will allow customers in the UK to buy, sell and hold bitcoin and other cryptocurrencies starting this week. The roll-out, which marks the first international expansion of PayPal’s cryptocurrencies services outside of the United States, could inspire further mainstream adoption of the new asset class, reported Reuters.

The total market value of cryptocurrencies was at $2.17 trillion on Sunday, according to data from CoinGecko.com, up 1.1% in the past 24 hours. The overall value has been helped in the past seven days by the 18% rally in Cardano and Binance Coin’s 11% gain, while Dogecoin is up about 9% over the period and Solana 73%, CoinGecko pricing showed.

(With inputs from agencies)

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Why Cryptocurrencies Are Down Big Today

What happened

In another volatile day, cryptocurrencies dropped rapidly on Tuesday, more than reversing Monday’s gains. In the last 24 hours, Bitcoin (CRYPTO:BTC) has fallen 3%, Ethereum (CRYPTO:ETH) is down 5%, and Dogecoin (CRYPTO:DOGE) has dropped 7.6%. Momentum also appears to be pushing these cryptocurrencies lower, so the fall may not be over yet.

As usual, regular volatility is likely the biggest driver with cryptocurrencies simply selling off as investors take profits. But there are some fundamental concerns that investors are likely worried about as well.

So what

I think the biggest concern is hackers stealing hundreds of millions of dollars in cryptocurrencies over the last few weeks. The $600 million hack of the Poly Network hit the sector a couple of weeks ago, but those funds have now been returned. It’s a lower-profile $97 million heist last week that investors may just be hearing about. Theives have reportedly already “cleaned” $20 million in cryptocurrencies that may not be recovered and it’s possible most of the stolen cryptocurrency is gone. If hacking risk grows, it could be terrible for cryptocurrencies long-term.

The regulatory front is full of risks as well. SEC chair Gary Gensler has said he is in favor of rules that protect investors and consumers without completely killing cryptocurrencies. And for now that means treating them as securities, just like any stock or bond. That comes with a double-edged sword: On one hand, it signals legitimacy that could increase the adoption of cryptocurrencies; on the other hand, it could mean broad tax consequences for traders and investors. And with rules still up in the air, it’s not surprising to see a pullback when cryptocurrencies rise like they did yesterday.

On the trading angle, it’s not unusual for an asset to pull back after a quick increase in price. In the case of each of these cryptocurrencies, you can see that they jumped over 50% in value over the last month, before today’s pullback. Sometimes a correction is just a normal part of investing.

Now what

The battle between cryptocurrency fans and the traditional financial infrastructure continues, and it will be a volatile ride. But I think it’s clear that cryptocurrencies are carving out a niche for themselves, whether that’s as a store of value or a way to pay for goods and services. But there are still unknowns when it comes to how governments around the world will treat cryptocurrencies.

What’s most concerning long-term is the regular hacks that hit cryptocurrency wallets. If investors and consumers can’t trust that their cryptocurrency will be safe they may not adopt it as widely as many hope. And that’s ultimately what will keep cryptocurrency values from growing.

I would chalk today up as another example of volatility in cryptocurrencies, but watch the hacking and regulatory trends for cryptocurrencies because that’s what will likely tell us if this pullback is temporary or the start of a downward trend.