Cryptocurrencies Plummet Including Bitcoin... Only Dogecoin Shows Strength

14% Plunge in 1 Hour... Altcoins Also Weak Across the Board
Only Dogecoin Supported by Elon Musk Shows Strength

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] While Bitcoin, the leading cryptocurrency, plummeted amid a series of negative factors, Dogecoin, which is facing speculation concerns, instead rose.

Bloomberg reported on the 18th (local time) that Bitcoin prices experienced the largest drop since February.

Bitcoin was trading around $60,000, but in just over an hour early that morning, it fell nearly 14% to the $51,000 range. It has since been trading around $55,000.

Bitcoin has been experiencing increased volatility with sharp fluctuations since last week.

On the 14th, Bitcoin reached an all-time high of $65,000 just before the Nasdaq listing of cryptocurrency exchange Coinbase, but then slightly declined following Federal Reserve Chairman Jerome Powell's comments evaluating speculative assets.

Bitcoin later recovered to the $63,000 level, but then dropped back to the $60,000 range after news emerged that the Central Bank of Turkey banned Bitcoin payments.

There are roughly three factors identified as causes for the Bitcoin price plunge that day.

U.S. media reported that an unconfirmed rumor spread that the U.S. Treasury Department plans to investigate financial institutions for money laundering using cryptocurrencies.

Another factor was the power outage in the Xinjiang region of China, where Bitcoin mining is heavily concentrated, which caused a drop in the 'hash rate,' a measure of mining intensity. According to Bitcoin specialized media, Bitcoin prices and the hash rate have historically moved in similar directions.

It is also analyzed that news of major executives at Coinbase selling off large amounts of their shares immediately after the listing influenced the market.

The sharp drop in Bitcoin prices is also notable because it occurred right after Dogecoin, which was created as a joke, surged last week and its trading volume skyrocketed, raising concerns about a bubble.

While most altcoins besides Bitcoin also fell, Dogecoin returned to an upward trend.

After surging over 400% last week, Dogecoin initially fell by over 20% ahead of Bitcoin but then rose by 10%, climbing back to 6th place in cryptocurrency market capitalization rankings. Dogecoin's 7-day increase rate reached 350%.