Cryptocurrencies continued their 2018 swoon as worries over escalating government scrutiny combined with a broader flight from riskier assets to send Bitcoin to its lowest level since November.
The biggest virtual currency sank as much as 16% to $5 992 on Tuesday and was trading at $6 103.93 as of 2:51 pm in Hong Kong. Alternative coins Ripple, Ether and Litecoin all tumbled at least 14%.
The latest bout of regulatory jitters centred on the US, with Bloomberg reporting that the country’s two top market watchdogs are planning to ask Congress to consider federal oversight for digital-currency trading platforms.
Chiefs of the Commodity Futures Trading Commission and Securities and Exchange Commission will appear together at a Senate Banking Committee hearing on Tuesday.
Cryptocurrencies tracked by Coinmarketcap.com have lost more than $500bn of market value since early January as governments clamped down, credit-card issuers halted purchases and investors grew increasingly concerned that last year’s meteoric rise in digital assets was unjustified.
This week’s selloff has coincided with a rout in global equities, with markets in Asia extending losses on Tuesday following a white-knuckle day for US stocks.
Some technical indicators suggest the rout in Bitcoin has further to go.
The cryptocurrency’s Moving Average Convergence Divergence indicator, the most profitable of 22 trading signals tracked by Bloomberg over the past year, is flagging further downside after turning bearish in December.
Bitcoin also dipped below its 200-day moving average for the first time in more than two years on Tuesday. The last time that happened, in August 2015, the cryptocurrency sank as much as 24% over the following two weeks.