BITCOIN and other cryptocurrencies will take centerstage at the G20 summit in Argentina over the next few days, but how will the threat of global regulation impact crypto prices?
However the risk of tighter regulation is still very much on the table after Japan urged fellow G20 members to crackdown on crypto money laundering and other illicit activities.
Observers in the crypto space have noted tightening the grip on virtual tokens will have an adverse affect on the prices of bitcoin, Ethereum and Ripple among others.
But experts at cryptocurrency trading platform Blocktrade.com are not entirely convinced world leaders will reach a consensus on the issue this week.
In the short run, Chief commercial officer Giovanni Lesna argued the crypto discussion at the summit in and of itself will have a bearish impact on prices.
He said: “The value of cryptocurrency is notoriously volatile. Most people with even a passing interest are aware of how it can plunge or soar at any moment.
“But a lot of this volatility is the result of rumours and mistruths — the type of thing we are likely to hear coming out of the G20 summit.
“At the end of 2017 it was reported that South Korea was about to ban cryptocurrency. It was just planning to ban anonymous trades.
The value of cryptocurrency is notoriously volatile
Giovanni Lesna, Blocktrade.com
“The market is made up of people, and they will react what is in front of them — whether it is a fact or so-called fake news.”
At 2.46pm GMT today, bitcoin was exchanging hands for $8,578.97 – up by 4.67 percent.
Bitcoin prices have been notoriously fickle since the start of the new year, strongly reacting to every hint of regulation at the hand of governments and regulators.
Earlier last week bitcoin prices tumbled in the wake of Google announcing a blanket ban on cryptocurrency and initial coin offering (ICO) advertising, to protect people from scams.
And prices tumbled in February after a vague statement by Indian finance minister Arun Jaitley led to reports India was cracking down on crypto trade.
Mr Lesna said: “He actually said that crypto currencies weren’t recognised as legal tender, and he would take steps to prevent ‘cryptoassets in financing illegitimate activities’.
“The government was only announcing that it could add extra regulation. But that did not stop it being reported that India considered the currency illegal.
“Again, it dragged the price of Bitcoin down.
“These stories make for good reading, but also exacerbate fears the volatile crypto ‘bubble’ has burst. Or is just about to.”
Others have now urged the G20 leaders to remain level headed and approach the crypto issue with “common sense”.
Iqbal Gandham, UK managing director at crypto retailer eToro, welcomed Mr Carney’s comments amid wider anti-crypto sentiments.
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