The SEC is stepping up enforcement actions against crypto companies and considering new rules. "If there is no guidance whatsoever, people will be taken advantage of, and we want to prevent that" says Cam Harvey, a finance professor at Duke University. Right now, both the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) claim oversight of parts of the crypto market. On Thursday, the Fed raised rates by three-quarters of a percentage point and indicated it could raise them again by the same amount at its next meeting in July if needed to cool down prices.Ĭrypto markets are still fairly new, and there's a lack of clarity even about the most basic things, like who is in charge of overseeing the space. Why are cryptos falling so sharply?īecause they are being hit by the same factors impacting stocks and other assets.Ĭonsumer prices are surging at the fastest annual pace in over four decades, and the Federal Reserve is hiking interest rates aggressively to bring down inflation. "The crypto house is on fire, and everyone is just rushing to the exits because there is a complete loss of confidence in the space," says Ed Moya, a senior markets strategist at financial firm Oanda.
Today, Bitcoin and other cryptos are plunging, and companies such as Coinbase, which runs the largest crypto exchange in the U.S, are announcing layoffs. Just months ago, crypto companies were advertising heavily during the Super Bowl after virtual currencies enjoyed a dizzying rally in 2021. Bitcoin and other cryptocurrencies have plunged in value in recent days. A Bitcoin ATM is seen at a subway station in Brooklyn Heights in New York City on June 13.
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