It’s been a fierce battle for silver in the cryptocurrency world in recent days.
On Monday, Ethereum regained the title of second most valuable cryptoccurency after rival asset Ripple held its ground for roughly a week.
Ripple prices fell roughly 25% Monday to $2.50, leading a broader sell-off in the cryptocurrency markets. Bitcoin values also fell roughly 7.6% to $15,000, while Ethereum prices rose slightly, 2.5% to $1,155. That pushed Ripple’s market capitalization down to $98.5 billion, and lifted Ethereum’s value to $111.9 billion, according to data firm CoinMarketCap. Bitcoin, meanwhile, maintains its top spot with a valuation of $255.1 billion.
It was a hodge podge of news Monday that helped shape those shifting dynamics. For one, reports have emerged that the Chinese government, home to the world’s largest Bitcoin mining operation, would push for an “orderly exit” from the cryptocurrency mining business, Quartzreported.
Then, CoinMarketCap, a major source of information in the crypto world, decided to remove data from South Korean exchanges in its calculation of asset prices. Since cryptocurrency generally trades higher in South Korea, the removal looked like a sudden across-the-board sell off—triggering panicked selling from investors who were not immediately made aware of the change.
“First, it was due to capital flows with investors realizing their profits from cryptocurrencies,” said Iqbal Gandham, Managing Director at cryptocurrency brokerage eToro in an email to Coins2Day. “Secondly, a data adjustment by CoinMarketCap, the most popular site for cryptocurrency pricing data, removed South Korean exchanges from its site, which have been known to trade much higher than the rest of the world.”
This morning we excluded some Korean exchanges in price calculations due to the extreme divergence in prices from the rest of the world and limited arbitrage opportunity. We are working on better tools to provide users with the averages that are most relevant to them.
— CoinMarketCap (@CoinMarketCap) January 8, 2018
While the execution left something to be wanted, the exclusion of South Korean markets seemed logically sound to some cryptocurrency watchers, including Ripple Chief Cryptographer David Schwartz.
They are outliers due to a shortage of cryptos in Korea and difficulty getting KRW out. The new price is more accurate and meaningful, IMO.
— David "JoelKatz" Schwartz (@JoelKatz) January 8, 2018
Ripple’s price, which rose as high as $3.65 last week, may have gotten an extra push southward after the largest U.S.-based cryptocurrency exchange Coinbasequashed rumors that it might allow trading of Ripple in the near future.
“As of the date of this statement, we have made no decision to add additional assets to either GDAX or Coinbase,” a Coinbase representative wrote in a Jan. 4 post. “Any statement to the contrary is untrue and not authorized by the company.”
That dispelled hopes that Ripple would be exposed to even more investors, namely, those on Coinbase.
At the same time, investors have also been worrying as to whether Ripple is in bubble territory. The asset has jumped 900% in the past month alone.