Scrutiny over Cryptocurrency Regulation Increases – Bitcoin Drops below $23,000

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The most popular cryptocurrency, Bitcoin (BTC), is once again under pressure as it temporarily dropped to a four-week low of $22,408 on Thursday morning, 9th February, before rising to values of about $22,715 by press time.

10th February’s decline follows Bitcoin’s impressive performance in January when BTC soared about 40% since the year’s beginning. It was undoubtedly increasing investors’ hopes for a new bull run.

The market capitalization of Bitcoin decreased by nearly $10 billion as a result of the most recent price movement; it is now $437.9 billion, down from $$448 billion on 8th February 2023. The largest cryptocurrency in the world presently holds 39.4% of the market, with Ethereum coming in second with 17.7% of the total.

The second-largest cryptocurrency in the market, now trading around $1,640, dropped 2% throughout the day. You will find similar price trends in other well-known cryptocurrencies, such as Dogecoin (DOGE), Binance Coin (BNB), and Cardano (ADA). Many cryptocurrencies are experiencing daily losses between 2% and 3.5%, on average.

Increasing Crypto Scrutiny from Regulators

An increase in regulation, or even a rumor about it, can often result in a downward spiral of the market, which was the case in the recent BTC price drop. Experts believe it resulted from SEC’s increased interest in Kraken’s investigation.

According to Bloomberg, the investigation is at an “advanced stage,” citing an unknown individual familiar with the situation, and “may lead to a settlement in coming days.” Kraken declined to comment on the matter.

On Wednesday, 8th February, 29023, in a series of events that seemed to happen simultaneously, Brian Armstrong, the CEO of Coinbase, posted a lengthy discussion on Twitter about “rumors that the SEC would like to get away of crypto staking in the US for retail clients.”

He stated that he hoped that was not the case because he thought it would be a terrible route for the US if that was permitted.

What Do Other Crypto Experts Say?

The CEO of Coinbase says that staking allows users to engage directly in running open crypto networks. He also claims that it brings multiple good enhancements to the field. As per his conviction, these include scalability, greater security, and decreased carbon footprints.”

Michael Demissie, the Bank of New York Mellon’s head of digital assets, said on Wednesday that ambiguous regulations are to blame. According to him, clear regulations and rules for the road are a must. He said, “We require trustworthy individuals who can deliver services that merit investors’ confidence.”

While addressing the 7th Annual FinTech and Regulation Conference of Afore Consulting, Demissie expressed his conviction that cryptocurrencies are here to stay. Additionally, he stressed the need for “responsible navigation” of the field.