Yesterday the US stock market took a downward spiral. It is said that this month is set to become one of the lowest December performances by the US market since the Great Depression. Meanwhile, on the obverse, the cryptocurrency market takes an upturn
The Federal Reserve (Fed) is soon expected to bring in a verdict on whether they will raise interest rates. This caused unease among investors and it might have caused the market downturn. Nasdaq fell by 2.3%. The S&P 500 plunged 2.1%, its lowest point in 14 months. The DJIA (Dow Jones Industrial Average) lost 2.1%.
Stocks in Europe also took a tumble. Index provider, Stoxx, fell 12% this year.
Asset allocation strategist, Stefan Keller, remarks that asset groups are down, lower than 2008.
Cryptocurrency Markets Turn Green But is Still Not Green Enough
Last October, the cryptocurrency market lost $16 million in valuation following the DJIA, S&P 500, and Nasdaq’s dive.
History did not repeat itself. The cryptocurrency market has seen an 80% decline this year from its 2017 highs. But today the market’s capitalization is up 8.84%. As US stocks take a hit, Bitcoin climbs 8.39%, priced at $3,784. Ether is also up by 10.72%, priced at $103.04.
While the greens of the crypto market give investors hope, it still needs to gain more momentum to be able to reach a fair height worthy of its peak.
The Fall: Did Excessive Regulations Pull the Market Down?
Peter Du of Du Capital, a blockchain venture fund, thinks that the Securities and Exchange Commission (SEC) with their ‘heavy-handed over-regulation’ and the bear market created obstacles for an ecosystem that is still under development. He remarks that Ethereum is an example of how too much regulation can arrested growth. He follows that the preceding bull run was in nature speculative and was not of help to ‘Ethereum’s technology or ecosystem development’.
To circumvent the regulatory obstacle field, Du Capital and other venture funds have deviated to security tokens.
The market is seeing potential signs of a new initiative, technical developments, and foreign investments. Du is taking the ‘wait and see’ track nonetheless.