Cryptocurrency vs. Stocks: Understanding the Difference......By: Mian Muhammad Nadeem group editor urdupoint dot com

Cryptocurrency sharing has drop more than 20 percent looking at a bearish market as a crypto crackdown looms.  Cryptocurrencies, or virtual currencies, are a new class of digital assets powered by blockchains, distributed ledgers that made their name underpinning networks like Bitcoin and Ethereum.

The Cryptocurrency market has lost almost a total of three-hundred billion dollars in market valuation of the cap of eight-hundred billion. The trillion dollar mark almost in reach, the value is at a half a trillion dollar market cap. The top two trading crypto curriencies Bitcoin and Ethereum              however are not alone as the total market has taken a hit. The Asian-based crypto-currency NEO fell nearly 30% to $133.24 at 10am Tuesday morning but has since risen back to $157.64.

A broader sell of at the beginning of the month seen the digital asset slide more than thirty five percent leaving Bitcoin trading around eleven thousand. Comparing this to last month’s trading of around twenty thousand, it has lost half of it’s value in one month alone.

Cryptocurrencies such as Ripple, Cardano, Steller Tron, Bitcoin Gold are down ten percent compared to Bitcoin as market fears increasingly grow.

The Asian front, especially South Korea and China are  two of the largest cryptocurrency markets for trading are voicing regulatory measure on cryptocurrency.

South Korean Finance Minister, Kim Dong-yeon says they are looking into shutting down crypto currency exchanges, however no official measures have been made as of yet.

China has said they are shutting down mobile apps and services that offer exchange trading.

 In September of 2017 China banned all companies and individuals from raising funds via ICO activity and deemed the practice as illegal. However The crackdown on ICO’s caused the value to bottom out only to rebound the following day.  

The difference is in this case are more and more regulatory concerns over virtual currencies like bitcoin,  Ethereum and Litecoin and other cryptocurrencies operate outside traditional financial system, regulators are worried over money laundering, funding of terrorism, tax evasion and fraud both in Asia and the US as well.

 Chair of the European Securities and Markets Authority (ESMA) has a warning: Cryptocurrency does not have enough stability and is not widely accepted by many countries and warns investors to prepare to loose their investments.

Comments on the subject by prominent figures have in the past voiiced concern: and Joseph Stiglitz, a Nobel laureate and former International Monetary Fund (IMF) economist said;

"One of the state's primary tasks is to create a currency. Whereas bitcoin is just a bubble, just like those of its kind. It also does not make any sense socially. For this reason it should be immediately banned," Stiglitz said.

Meanwhile, Turkey's Central Bank Payment Systems General Manager Mustafa Okay said: "These technologies are inevitable. Different countries around the world are still working on it and taking some precautions. It can't be directly forbidden, nor left completely free. We have started research on digital technologies and virtual currencies with the central bank and related institutions."

The Religious Affairs Directorate of Egypt deemed bitcoin "contrary to Islamic rules," citing that the cryptocurrency is not connected to any central authority, carries the risks of "forgery, disinformation and fraud" and causes harm to individuals, groups and institutions.

Some however see this as an investors market and view concerns of regulations as one that will be worked out as cryptocurrency is seen as here to stay. Just an example, Bitcoin is in an oversell compared to a hold or buy-in that some say reflects a possible further depreciation of the currency as a double bottom has not yet hit the crypto markets.

Like the stock market, cryptocurrencies move up and down. The market trend indicators say we could see a flush and over extended that could be as low as 8,600 - 9,700.

However a rebound is not unlikely as serious buyers sit on their currency and begin to buy low as sell offs continue. Altcoins like Ripple,Tron and Ethos, which is down to 645 is said to be a good buy in for a high risk player for a shorter run swing trade. However Bitcoin is seen as a medium risk with high reward. As we seen in past market,  Bitcoin made a run to 10K and pulled back to 5,000 and those lows even though Bitcoin is hovering around eleven thousand the double bottom is projected to be way above that mark. Many investors are struggling to determine what tighter restrictions or outright prohibition could mean for the value of crypto currencies and could lead to devaluation across the board.

Despite the concerns, State Treasuries are taking notice the market for a cryptocurrency and are looking into filling the gap. Back in late 2017 Dubi announced their own cryptocurrency called emCash. It is believed to the first state cryptocurrency. emCash will become legal tender “for various government and non-government services, from their daily coffee and children’s school fee to utility charges and money transfers”

The managing director of the International Monetary Fund, Christine Lagarde said in an interview with Fortune in October of 2017, that she sees a potential of virtual currencies to supplant traditional monies in coming decades.

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