ALSO READBitcoin finds floor after worst selloff since 2015 Amid regulation worries, Bitcoin down to $10k for 1st time since Dec 1 Goldman Sachs to set up cryptocurrency trading desk by June-end: Report Bitcoin prices can drop by half and China's miners will still make money Entrepreneurs catch bitcoin bug
Cryptocurrencies plunged on Friday, with several of the largest falling by more than 20 per cent and bitcoin sliding below $8,000 and headed for its worst week since 2013, as worries about a regulatory clampdown globally sent investors scrambling to sell.
The slump in prices this week means the total market value of cryptocurrencies is down to $385 billion, less than half the high it reached in January, according to industry tracker Coinmarketcap.com.
The market value of cryptocurrencies is calculated by multiplying the number of digital coins in existence by their price, although many question whether that is the right way to value them.ALSO READ: How Bitcoin's popularity draws hackers into red-hot cryptocurrency space
Bitcoin, the biggest and best-known cryptocurrency, fell 12 per cent on Friday to a two-month low of $7,910 on the Luxembourg-based Bitstamp exchange. It is down more than 30 per cent this week.
The second and third largest virtual currencies, Ethereum and Ripple, have plunged 23 and 31 per cent respectively in the past 24 hours, Coinmarketcap.com said.
"The regulatory pressure is extremely strong and that is creating a bad environment for cryptos.
Retail investors have poured money into digital coins, enticed by the huge run-up in prices, but regulators who say cryptocurrencies are highly speculative and dangerous investments are wrestling with what to do.ALSO READ: Catching up on crypto: A quick rundown of terms that defines digital money
Social media website Facebook said this week it would ban cryptocurrency advertising because many were associated with misleading or deceptive promotional practices, while US regulators have sent a subpoena to two of the world's biggest cryptocurrency players, Bitfinex and Tether
A massive $530 million hack of a Japanese cryptocurrency exchange last week has also renewed concerns about the security of the industry.ALSO READ: I-T turns heat on Bitcoin investors who have still not paid their taxes
The run-up in prices, however, has largely been driven by speculative investment.
Going back to 2011 and including the current selloff, bitcoin's price has been halved nine times on the Bitstamp exchange before it recovered. The last time was from November 2014 to January 2015.