January 2018, a black month for cryptos

This is not a euphemism to say that the cryptos market suffered last month. As usual, the collapse of values ​​is related to more than one reason.

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Image from pixabay

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January, a historically difficult month

The first correction factor is simply seasonal. Since the creation of Bitcoin, January has always been a month of correction. This is the month of tax returns but also the Chinese New Year, which pushes Asian investors to sell their currencies massively before the holidays (as European and American markets sell massively before Christmas).

So far, Bitcoin has always recorded a nice recovery for the month of February. An exception however in 2014, when MT Gox stopped withdrawing and then disappeared leaving many investors on the straw.

Exchange platforms

In addition to this seasonal factor, a number of reasons may explain the decline in demand in the cryptocurrency market. One of these reasons is the freezing of the registrations on the biggest platforms of exchange: Bittrex, Coinbase, Binance, and many others had to react to the overload of their networks and made the choice to block the inscriptions of temporarily, like Kraken, in order to guarantee the continuity of their service offering to their existing customers.

The size of the market has therefore suddenly stopped growing. At the same time, the exchanges had many difficulties to get off to a good start on a technical level, and a certain number of transactions could not be realized, thus discouraging part of the retail market to be dynamic on their platform.

Regulations of the Korean market

The status quo of the platforms can not in any way explain the violence of the correction of the month of January. Among the main reasons, let us note the impact that the Korean regulations will have had on the Chinese market, which had hitherto found refuge on the platforms of South Korea.

The statements of Korean institutions, sometimes contradictory, have undoubtedly helped to shake the cryptocurrency market: prohibition of anonymous trading (relayed in the press as a strict prohibition of trading), inspections of banks, change in tax legislation at destination Korean platforms ... The regulation hardens to fight against money laundering, and will have dropped the value of crypto favorite Chinese.

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