Bitcoin has taken a turn for the worse. Following news of Coinbase going public on the Nasdaq last week, the world’s number one digital currency by market cap rose to nearly $64,000 per unit, though at press time, it has knocked roughly $8,000 off its price.
Bitcoin Has Taken a Nasty Fall
At first glance, this looks like a standard correction. We have all seen instances like this in the past. When bitcoin spikes to new highs rather suddenly, it becomes obvious over a few days that the asset is not in any state to handle the larger territory. Thus, a correction occurs, and bitcoin falls to a more “comfortable” level. It has happened time and time again.
It might seem natural to assume that this time around is no different. BTC rose thanks to the Coinbase news and subsequently died down in price due to what has become a natural process, though for some, the drop is the mark of something a little more sinister. There are many analysts out there claiming that this year will see more regulators entering the bitcoin space as they work their behinds off trying to monitor and mold what appears to be a growing – and thereby threatening – industry.
This attitude of gloom and doom is stemming from the likes of executives with the World Economic Forum (EWF), which claimed that bitcoin will soon be thrust into a “dramatic” round of regulation. Sheila Warren – the WEF head of data, blockchain and digital assets – explained in a recent interview:
We’re going to see another round of pretty dramatic attempts at regulating this space… As there is more and more activity in these spaces, there is more and more demand signal for regulators to get engaged and involved.
The topic of regulation has become a rather heated discussion in recent years given that it has two contrasting sides. On the one hand, regulation is likely necessary given that the crypto space has been wrought with fraud and crime since it first rose to fruition. Events such as Mt. Gox and Coincheck and all the money that was lost as the result of these events could have potentially been avoided if proper security and rules had been in place.
Regulation Is a Mixed Bag
At the same time, regulation could potentially limit innovation. Furthermore, it also goes against the very nature of crypto, which was designed initially to give financial power back to the people. With too many legislators getting involved, people could potentially stand to lose this independence, thereby bringing the primary goals of digital assets to a halt.
While Warren is concerned that there are likely to be major changes in the space during the coming months, she is confident that the crypto industry will continue to grow and experience good fortune, and she assures traders that bitcoin has yet to reach its “peak.”