Why did bitcoin drop today? Weakness across the board (Cryptocurrency:BTC-USD)
Vertigo3d/iStock via Getty Images
Bitcoin (BTC-USD) changed hands in the red in Friday mid-afternoon trading, erasing all of its gains from Thursday’s huge rally, as attention turned to altcoins after Ripple Labs scored a long-awaited victory in court.
The digital token slid 4.2% to $30.05K at 4:24 p.m. ET, after reaching as high as $31.7K in the prior session, when a U.S. District Court judge ruled that Ripple’s XRP (XRP-USD) is not a security in terms of sales to the general public.
That’s a big deal because the Securities and Exchange’s three-year-old suit against Ripple has raised the prospect that cryptos are in fact securities that fall under the regulator’s tough oversight.
“This is a great outcome for Ripple and cryptocurrency overall since it solidifies a new path forward for investors who are looking for clarity in digital assets,” said Joe Endoso, chief operating officer of private investing platform Linqto.
Note that the judge on Thursday ruled that XRP (XRP-USD) was a security when sold directly to institutions but was a commodity when sold to the public. While this marks a major turning point for the crypto industry, there’s likely a long road ahead for full regulatory clarity.
Intraday losses were widespread among risk assets, from cryptos to stocks. Two of the three major U.S. stock indices ended the session lower, with the Dow Jones eking out a small gain. The overall crypto market cap dipped 4.2% to $1.21T, according to data from CoinMarketCap data.