FXstreet

Investors have pointed to many different factors as causes for the drop. “At first, people said it was Bitcoin futures expiring,” says Kyle Samani, managing partner at Austin-based crypto investment firm Multicoin Capital. Some have cited reports that China is planning to ban crypto-asset trading on all exchanges, including those based in other countries. Others discussed impending U.S. regulation or claimed that people were selling to pay taxes, according to Samani. And Monday’s steep drop in the U.S. stock market might have caused more people to sell their crypto to lower their portfolio risk, he acknowledges.



But he thinks there’s a simpler reason at work: “The crypto market got overheated,” he says. “November through January was insane. Especially some of the altcoins—it was ludicrous.” He points to Ripple, whose XRP coin reached a market value of more than $140 billion, even though Ripple’s technology was only being piloted at some banks, and not fully adopted.

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