People other than just the technophobes find themselves worrying over the boom in the virtual currency markets lately. Many problems arose from the growth and many of those problems were covered up. The scale of these secret problems is now becoming evident as digital currency is now sliding down to less than 50 percent in value. They had just recently peaked in January. The steep drops happening have pushed the popular bitcoin down to less than $7,000 in value this past Monday.
Some of the issues behind these drops include hackers draining user’s funds from the many online exchanges, the Ponzi schemes and the threat of new regulations from government officials. They are unable to keep up with the popularity of all cryptocurrencies. There are signs of trouble for this type of digital currency popping up for every level in the industry. From chat rooms where it’s being discussed to the biggest digital currency exchanges in the world, the signs are coming.
Today, the leaders for two of the main regulatory agencies here in the United States which oversee technology are coming together. The Exchange and Securities Commission and the Commission of Commodity Futures Trading are going to testify to the Senate banking committee about what their efforts are going to be about policing the markets of virtual currency which are popping everywhere. They have pleaded their cases before in the past couple weeks with nothing being done about it yet.
Some enthusiasts of the virtual currency believe that the problems with the cryptocurrency are no different than other booms that happen. The true believers of the design of virtual currency, meant to cut out government authorities and any middlemen, have made illegal activities and bad behavior more prevalent with this particular boom.
Many believe that cryptocurrencies are the perfect vehicle for scammers. The combination of low barriers and credulous buyers made it almost too tempting for scammers to partake in. The government agencies in the U.S. have worked hard to shut down a few of the more notable scams. The BitConnect operation was shut down in North Carolina and Texas. However, by the time it was shut down, it was worth over $3 billion dollars.
These moves were made after the company had operated in an open manner for months while they collected hundreds of millions from different people all around the globe. The company had offered tokens through their exchange on a decentralized type of network. This is similar to how bitcoin exchanges are conducted except they had promised regular payouts to their coin holders instead.