Bitcoin Tumbles Below $59K Amid Inflation Worry, Regulatory Onslaught on Crypto

As a seasoned crypto investor with a knack for navigating through market volatility, I can’t help but feel a sense of deja vu as I watch prices plummet once again. The rollercoaster ride we’ve been on these past few months has tested even the most resilient of us.

It appears that digital currencies are encountering numerous challenges across various areas. Yesterday’s news included an inflation rate increase for September that was swifter than anticipated, as well as additional U.S. government regulatory actions targeting industry members.

crypto started off with a weak start today following the unexpected acceleration of inflation as indicated in the U.S. Consumer Price Index report for September. This news seems to have dashed hopes for another 50 basis point interest rate cut by the Fed in November, and some market participants are now speculating that the US central bank might even decide to halt its rate-cutting cycle during that meeting.

During the afternoon, prices plummeted further due to the announcement that the U.S. Securities and Exchange Commission (SEC) had filed a lawsuit against significant digital asset market maker Cumberland DRW. This development renewed worries about the complicated regulatory landscape for U.S.-based crypto companies. According to the SEC, Cumberland DRW traded cryptocurrencies that were classified as securities without first registering as a securities dealer.

In response to the lawsuit, Cumberland clearly stated they have no intentions of altering their business functions or the resources they use for providing liquidity due to the Securities and Exchange Commission’s (SEC) actions.

This week, I’ve witnessed an escalation of regulatory actions by the U.S. government towards cryptocurrencies. On a particular Wednesday, the Department of Justice indicted four market makers and over a dozen individuals, alleging them for market manipulation. Moreover, on the same day, SEC Chair Gary Gensler expressed skepticism about the potential adoption of bitcoin or crypto as a significant means of payment. He pointed out numerous instances of fraud within the crypto industry, labeling it as a haven for “fraudsters.” Furthermore, he suggested that the key players in this sector were either currently incarcerated or facing imminent imprisonment.