Cryptocurrencies were broadly lower on Wednesday alongside a slump in global markets as investors worry economic recovery will slow due to a spike in coronavirus cases worldwide.
Dogecoin (DOGE-USD) which had rallied over the weekend, plunged 11% and was trading at $0.29.
Equity markets have “affected crypto markets as well, because of which digital coins are going through a correction in prices,” said Naeem Aslam, chief market analyst at Ava Trade.
“Going forward, the price action of cryptocurrencies is likely to show strength as they have been testing their respective resistance levels over the past few days. A breakthrough of these levels would propel the digital currencies to fly even higher.”
He said investors should keep in mind that the cryptocurrency industry is undergoing a “revolution,” and many institutions are working to make the use of these digital assets a reality soon.
For instance, Visa (V) is working to connect global electronic payment systems to blockchain technology.
So far 54 fintech companies have joined the payment firm in its goal of making it easy for consumers to use digital coins as a means of payment.
In 2021, its crypto-connected debit cards assisted in conducting transactions worth nearly $1bn.
“This development demonstrates the enormous potential of crypto currencies, and as a result, now is a good time for investors to scoop up some bargains before crypto prices resurge again,” said Aslam.
Meanwhile Binance, the world’s largest crypto exchange, said it had appointed Greg Monahan, a former US Treasury criminal investigator, as its global money laundering reporting officer.
“My efforts will be focused on expanding Binance’s international anti-money laundering and investigation programmes, as well as strengthening the organisation’s relations with regulatory and law enforcement bodies worldwide,” said Monohan.
The move comes amid heightened scrutiny for the company, as well as the crypto industry, from regulators around the world.
The industry recently failed to win a change to tax reporting rules in the US’s infrastructure bill. Legislation passed on Tuesday last week has outlined broad oversight of digital currency.
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