Was Bitcoin and crypto crash planned long ago to implement crypto regulations? Report

• The recent fall in the price of crypto assets is linked to strict enforcement of crypto regulation, with stakeholders citing a plan to crash the industry.
• Will the Ripple-SEC Case Make or Break the Crypto Market?

Cryptocurrencies and virtual assets are volatile. Unfortunately, there is no two-way about this because it has a frequent pattern of booms and busts, which has made many wonder if it is worth investing in them. However, there are murmurs of industry instability, suggesting a long-term plan to implement crypto regulations. Let’s dive into some recent events that have led to these grumblings.

The value of Bitcoin, the famous “digital gold”, fell by more than 90 percent from its previous record high of $69,000 in 2021. Bitcoin’s price plunged below $16,000 in November 2022, showing a disturbing trend that has continued to grace the market. Additionally, the broader digital currency ecosystem is on a downward trend. So the question is what triggered the decline?

Bitcoin and other crypto-assets have for most of 2022 performed poorly and had a turbulent time in recent weeks. However, macroeconomic events, such as the war between Russia and Ukraine, interest rate hikes and rising inflation, are affecting the crypto industry.

The cryptocurrency decline in November was triggered by the crash of FTX, one of the leading crypto exchanges in the world. The FTX situation has affected the digital asset space due to its huge daily transaction volume of almost $1 billion daily.

The June 2022 Celsius Network collapse occurred after Bitcoin fell below $20,000, sending panic among market participants. As a result, the US-based crypto exchange froze withdrawals and trades, citing “extreme” market conditions. The event led to a massive decline in the digital currency ecosystem, with the industry’s value plunging below $1 trillion.

Others cite China’s crackdown on crypto trading as why the price of crypto assets continues to fall. Rumors that Russia is stopping crypto trading also contributed to the decline. In addition to the above, the massive sell-off of key crypto-tokens has continued to trigger fear and further selling, with consumer confidence at an all-time low.

Are crypto regulations responsible for the price crash?

One of the latest discussions surrounding the constant fall in the price of cryptocurrencies is the action of regulators. Unfortunately, regulators’ threat to implement strict policies will continue to depress the value of digital assets. Several events have affected industry players’ perception of a grand scheme by regulators to enforce new rules and drive down crypto asset prices.

At the beginning of the year, reports indicated that Russia was considering banning crypto transactions. However, after it invaded Ukraine, there were strong calls for crypto exchanges to remove Russia from their platforms.

Following the statement by Elon Musk in May 2021 that Tesla would no longer accept payment in Bitcoin due to concerns about the environmental impact of crypto mining, the price of Bitcoin fell further. Then, in June 2022, the world’s largest crypto exchange, Binance, temporarily paused Bitcoin withdrawals, with its CEO stating that a bug was responsible for a “transaction backlog.”

Meanwhile, the FTX exchange is currently in a difficult situation after Binance backed out of an agreement to accelerate the recovery plan of the troubled firm. According to reports, FTX has filed for Chapter 11 bankruptcy in the US following the liquidity crisis.

Related: BREAKING: Binance won’t buy FTX, but a Singaporean investor – Will BTC go back to $20k?

In another twist of events, a US Republican lawmaker, Tom Emmer accused The Securities and Exchange Commission (SEC) led by Gary Gensler sided with the difficult CEO of FTX, Sam Bankman-Fried. The lawmaker claims that both parties are exploring regulatory loopholes to keep the exchange off any regulatory hook.

Interesting. @GaryGensler running to the media while reports to my office claim he helped SBF and FTX work legal loopholes to gain a regulatory monopoly. We are looking into this. https://t.co/SznowgcP6V

— Tom Emmer (@RepTomEmmer) 10 November 2022

In a Nov. 10 Twitter post, the lawmaker claimed the SEC chief is helping Bankman-Fried take advantage of any legal loophole to enable FTX to survive its current liquidity crisis. He also said he is investigating the situation to ensure justice is served. Emmer revealed that more information about the meeting between Gensler and FTX officials had to be submitted to his office.

The collapse of the Terra LUNA ecosystem negatively impacted the virtual asset environment as regulatory agencies increased oversight of this industry. Authorities around the world continue to take various steps to implement tighter regulations for the new industry.

The Ripple-SEC case and the crypto market

Meanwhile, the ongoing Ripple-SEC saga is seen as the conclusion of a long-term plan to implement stricter regulations on the crypto industry or, worse, stop crypto-related trading in some countries.

After the SEC dropped the hammer on Ripple in December 2020 by suing the blockchain firm, the agency changed the public’s view of the rising asset and its parent company.

Various questions keep popping up. Questions like “What will be the impact of the case on Ripple’s success?” Is Ripple Another Scam? All these and many more are some of the questions that need answers as the case continues in the news.

Ripple’s operation with significant banks in the United States did little to dispel the SEC’s perception of the firm. As a result, the company is still making a case for XRP despite its many uses for facilitating transactions in the traditional financial and crypto spaces.

Unfortunately, the SEC sees XRP as another fanciful financial product that will soon explode, given the volatility of cryptoassets. However, analysts believe the Ripple case is a test of strength for the SEC, which has been accused of using regulations to harass crypto companies.

Should the commission win, this could mean another looming problem for other crypto firms. If it lost, it would be a massive blow to its status as America’s premier securities watchdog. But regardless of the outcome, experts see the case as determining Ripple’s fate and the future of the crypto industry.