If you haven’t heard yet, the over all Crypto Market took a bit of a bashing overnight Monday after the decision by Coinmarketcap to remove prices from a large quantity of South Korean exchanges without prior warning. Currencies represented on South Korean Exchanges have been known to trade at a much larger value than the rest of the world which can cause prices to not be accurately reflective of regional demand. This is generally due to high volumes of localised demand and strict national controls.
Whilst removing South Korean markets theoretically shouldn’t harm overall prices the unannounced move did drop the total market cap across all cryptocurrenices by a very hefty $US35 Billion on Coinmarketcap in a matter of minutes. The decline continued until bottoming out at $US682 Billion an overall drop of 20 percent. As this article is being written at 11pm AEST 09/01/18 the Market Cap has climbed back up to $US733.9 Billion.
The continued decrease seemingly came from a large number of panic sells after noticing the inexplicable drop. Unsurprisingly Coinmarketcap has received quite a bit of backlash from the incident and again raises concerns regarding regulation. As pointed out by one of the more effected platforms Ripple Chief Cryptographer David Schwartz stated on Twitter to”Look closely at the data and don’t be mislead”, pointing to the fact that the removal of Korean markets made prices appear to drop but panic could have been avoided with proper research.
The majority of Cryptocurrencies are still seeing red after the changes, but we expect to now see prices more respective of global averages.
To get more insight for the year to come, why not check out some of our Winners and Losers of December 2017