Last week, cryptocurrencies such as bitcoin and ethereum were back on the rise after dropping off significantly over the weekend of July 15 ($1,758.20 for bitcoin; $130.26 for ethereum). However, as of Wednesday (July 26), both digital currencies are on pace for another stretch of losses.
On Thursday (July 20), bitcoin had rebounded handsomely to $2,853 per token and remained close to that range until early this week. By Tuesday (July 25), bitcoin had tapered off to $2,469.46 before recovering slightly on Wednesday. However, as of 3:06 p.m. EST, the price of bitcoin was $2,493.27–a 3.67 percent loss since the open on Wednesday.
The story is similar for ethereum, which sat comfortably between the $220 and $230 mark until mid-Tuesday. On Wednesday, ethereum had dropped to as low as $196.80, but has since increased marginally to $199.19. Overall, ethereum has dipped 3.81 percent since Wednesday’s open.
With the US Securities Exchange Commission (SEC) announcing on Tuesday its plans to regulate initial coin offerings, the drop in cryptocurrencies isn’t that surprising.
In an interview with MarketWatch, Chris Dannen, co-founder of Iterative Instinct, a cryptoasset fund, said that these kind of decisions help weed out “bad actors” and provide much-needed regulations in the cryptocurrency sector.
“The people that put themselves out there [by investing in ICOs] they are going to need to be a lot more careful and that wasn’t necessarily clear to everybody until yesterday” Dannen told the publication.
Despite the digital currencies’ recent price drop, Goldman Sachs (NYSE:GS) remain positive, suggesting that bitcoin could reach $3,600 in the near future.
According to Business Insider, Sheba Jafari, head of technical strategy at Goldman Sachs, said a run at recent record highs is “in the cards as bitcoin remains in the fourth wave of a five wave series.”
“Anything above 3,000 (Jun. 13th high) will suggest potential to have already started wave V, which again has a minimum target at 2,988 and scope to reach 3,691 (the latter being a preferred target as this assumes a new high),” Jafari said in a note.
Year-to-date, bitcoin is up 160 percent, while ethereum has climbed an impressive 2,375 percent.
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Securities Disclosure: I, Jocelyn Aspa, hold no direct investment interest in any company mentioned in this article.