The bear effect in the crypt market has proved persistent with frequent market blips giving investors a run for their money. The recent action by the US financial regulatory watchdog SEC on two ICOs (AirFox and paragon) has seemed to worsen even further an already terrible situation. However, blockchain attorney Stephen Palley is of the view that the temporary market failures are characteristic of a revolutionary technology and cannot change with respect to either the soaring or plunging of crypto prices.
Bitcoin price trend
Bitcoin price plunged drastically to below the $5000 bottom mark and has for some time traded near the $4000 support level. Over the past 12 hours, bitcoin managed to recover almost immediately from $4030 to $4200 and eventually soaring to 4560, a show of resilience in the dangerously low region despite extreme volatilities in the market.
The plunge was attributed to delays by ICE, the company underpinning the New York Stocks Exchange to launch Bakkt Bitcoin futures which saw the launch date moved from December 12th, 2018 to the 24th of January 2019. It is rumored that information about the same had been leaked to a handful of large-scale crypto investors which saw the purchase of the dominant cryptocurrency surge as it dropped in value towards the $4000 low region. This was so as investors intentionally attempted to accumulate the asset prior to the launch of Bakkt. The price of bitcoin had been predicted to hit a $15,000 high by the close of the year high should the Bakkt launch proceeded as earlier scheduled.
Is SEC’s tactical approach a cause for alarm?
According to the blockchain attorney, there exists no correlation between the crypto market woes and SEC’s action given cryptocurrencies are transboundary and cannot be bind solely by the US regulation since security laws differ by nation.
“I am not sure that there is necessarily any connection between recent SEC activities and the price of cryptocurrencies,” Palley said in an interview with Bloomberg.
Palley was quick to note that temporary market fluctuations cannot be used as determinants for the long-term viability of the crypto industry.
“I would not write off bitcoin, and I would not write off Ethereum, these are very interesting technologies.” He said.
The SEC had slummed both AirFox and Paragon with a fine of $350,000 with orders to refund all investors who had participated in their initial coin offerings. They were ordered to refund the investors a total of $15 million and $12 million respectively.