Bitcoin has gotten off to a bad start in December after many had hoped the worst was behind it, with the cryptocurrency market recording its steepest monthly declines in years last month.
The bitcoin price has moved sharply downward twice in the last 12 hours as bitcoin gave up the psychological $4,000 level that had appeared to support the price over the last week.
Bitcoin dropped as low as $3,790, according to CoinDesk’s bitcoin price tracker, back to near its yearly lows at the end of last month—and renewing fears the rout that began in November will bleed through to December.
The bitcoin sell-off, which has hit the wider cryptocurrency market even harder, was sparked by a civil war amongst developers and miners of the rival cryptocurrency, bitcoin cash.
In a drawn-out hash war, where the two camps battled to direct the largest amount of computing power to their chosen bitcoin cash variant, traders and investors bailed out of most major cryptocurrencies amid threats from some they’d prefer to see a wholesale price collapse than lose the war.
As the sell-0ff gathered pace, panic swept the marketleading to many deciding to cash out of their bitcoin and cryptocurrency positions, fearful the highs of late 2017 and early 2018 will never return.
The market has been fretting for months that the long-promised institutional investment surge may not transpire, as global banks and financial institutions delay or put on hold their plans to launch bitcoin and cryptocurrency investment products.
The latest sell-off has also cast a dark cloud over the U.S. Securities and Exchange Commission’s (SEC) decision expected at the end of December over a much-anticipated bitcoin exchange-traded fund, brought (and hyped) by U.S. investment firm VanEck, blockchain software company SolidX, and the Chicago Board Options Exchange (CBOE).
Though some are still confident the SEC will wave the prosal through, the latest rout and return to volatility after months a relative calm has knocked investor confidence.
“The market has become tired of great expectations and has been beaten pretty bloodily,” said Charlie Hayter, chief executive of Cryptocompare, a data company.
Bitcoin was far from the biggest loser amongst the world’s largest cryptocurrencies in the most recent sell-off, with EOS and litecoin recording the steepest falls over the last 24 hours, according to CoinMarketCap data.
Elsewhere, bitcoin SV, the loser of the bitcoin cash fork, could be set to fall outside the top 10 cryptocurrencies by market capitalization this week. The price has seen steep loses almost daily since it split from the bitcoin cash cryptocurrency last month.
Even Ripple’s XRP, which has been supported in recent months by deals with major international banking giants to provide cheap cross-border payments, has taken a beating, dropping almost 5% over the last 24 hours.
However, many are looking forward to a raft of other institutional products on the horizon, including bitcoin futures from the New York Nasdaq exchange from the beginning of next year, as well as the New York Stock Exchange (NYSE) owner ICE and Starbucks-backed Bakkt cryptocurrency investment platform.
Last week, NYSE chairman Jeff Sprecher told the Consensus: Invest conference that bitcoin will survive its latest sell-off