The viral, meme based cryptocurrency Dogecoin has suddenly crashed, dragging the cryptocurrency market down by billions of dollars. Multiple cryptocurrencies have been affected by the crash.
The price of the top five cryptocurrencies by value—ethereum, Binance’s BNB, cardano and Dogecoin—are all down by double-digit percentages in the last 24 hours with around $700 billion now wiped from the cryptocurrency market over the last week.
The market crash follows a decision by Tesla to no longer accept Bitcoin as payment for its vehicles, as announced by the car company’s CEO Elon Musk.
Ulrik Lykke, executive director at crypto hedge fund ARK36, said: “The crypto markets are currently processing a cascade of news that fuel the bear case for price development.
“When it comes to Elon Musk’s tweets or negative remarks from the People’s Bank Of China, it is important to distinguish their true impact from their perceived impact.
“Realistically, it is not the first time Elon Musk’s tweets have been erratic and, frankly, wrong; likewise, China has changed its stance on cryptocurrencies multiple times before.
“News like this can get a lot of traction and easily stir market sentiments but they often prove of little significance in the long term.
“The crypto markets are extremely emotionally driven and their participants are prone to overreacting to events they perceive as negative.”
