Over $60 billion wiped off value of cryptocurrencies in 24 hours
Prices of major cryptocurrencies saw a sharp downward slide Thursday, amid closer regulatory scrutiny on the space and after Google announced plans to ban advertising related to the sector.
Large selling from a trustee of now-defunct cryptocurrency exchange Mt.Gox was partly to blame.
Google also banned cryptocurrency-related adverts which hit sentiment.
By 4.00 a.m ET the bitcoin price had recovered to $8,219.77, pushing the total cryptocurrency market cap to $331.7 billion.
Bitcoin, the world's largest cryptocurrency by market cap, traded as low as $7,676.52 on Thursday, the lowest since February 8, according to CoinDesk data. However, by 4.00 a.m ET the price had recovered to $8,219.77, pushing the total cryptocurrency market cap to $331.7 billion.
The first major one was selling by the trustees of collapsed Japanese cryptocurrency exchange Mt.Gox. It closed in 2014 and filed for bankruptcy after losing around 850,000 bitcoins. Its founder Mark Karpeles, recently pleaded not guilty to charges of embezzlement.
A trustee of the now-defunct exchange has been selling large amounts of bitcoin that the exchange still owned in order to pay back creditors. This has been hitting the price of bitcoin.
Meanwhile, Alphabet-owned Google, the world's largest digital advertiser, announced it was banning cryptocurrency-related advertising, including initial coin offerings (ICOs), wallets and trading advice.
"The sell-off was triggered by a number of factors, notably, weariness over increased regulatory scrutiny of ICOs, the Mt.Gox bitcoin dump and what seems to be some heavily liquid traders pushing for future buy-back opportunities," Thomas Glucksmann, head of APAC business development at cryptocurrency exchange Gatecoin, told CNBC by email on Thursday.
Regulatory crackdown
Regulators globally have been taking a tougher stance on the sector as well. The U.S. Commodity Futures Trading Commission (CFTC) subpoenaed cryptocurrency exchange Bitfinex, and Tether, a digital coin company at the end of last year.