Bitcoin is still struggling to find a bottom this week.
The digital currency dropped 15 percent on Tuesday to its lowest level since September 30th of last year, according to data from CoinMarketCap.com. Bitcoin fell as low as $4,200.22, according to data from CoinDesk, bringing its total losses in seven days to roughly 30 percent.
The price plunge came after weeks of rare stability for the world's largest and best-known cryptocurrency. While global markets churned in October, bitcoin traded comfortably in the $6,400 range — a break from volatility earlier this year. Its total losses this year are now more than 65 percent.
Its epic rise started right after Thanksgiving of last year as it began to gain status as a household name. Since then, the cryptocurrency is now down more than 42 percent. Bitcoin first topped $10,000 at the end of November last year and made it to nearly $20,000 a week before Christmas as retail investors poured in and two regulated exchanges prepared to launch futures markets.
Some cryptocurrrency analysts pointed to Securities and Exchange Commission enforcements against multiple cryptocurrency projects last week for the precipitous drop this week. The SEC announced its first civil penalties against cryptocurrency founders on Friday as part of a wide regulatory and legal crackdown on abuses and outright fraud in the industry.
Others pointed to a "fork" in the cryptocurrency bitcoin cash. That digital currency split into two versions last week — "Bitcoin ABC" and "Bitcoin SV" — which analysts said added to negative sentiment in broader crypto markets.
The drop below $6,000 earlier this week triggered "stop losses" for some traders and exacerbated the selling, according to eToro Senior Market Analyst Mati Greenspan. From a technical analysis standpoint, as bitcoin continues to hit lower levels, it's possible that those stop loss orders are automatically going into effect as investors try to "play the breakout."
The drop also comes on the heels of a warning from European Central Bank Executive Board member Benoit Coeure at the Bank for International Settlements in Basel, according to a report from Bloomberg News. Coueure called it "the evil spawn of the financial crisis," and said he agrees with BIS head Agustin Carstens, who in June called cryptocurrencies "iin a nutshell, a bubble, a Ponzi scheme and an environmental disaster."
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