The cryptocurrency markets have been lethargic lately. The major cryptos have been consolidating and trading within a bound range. Some big news recently pushed prices down to a critical level. On Monday, March 26, the social media company Twitter (NASDAQ: TWTR) announced it would ban crypto ads beginning the next day. The news sparked a selloff of the crypto markets to a market capitalization of around $300 billion, where it has since hovered. Also on March 26, news broke that South Korea’s biggest conglomerates are entering the crypto markets. However, it does not seem that prices have reacted positively.
Following in the footsteps of tech giants Facebook (NASDAQ: FB) and Google (NASDAQ: GOOG), Twitter has decided to ban crypto ads in order to make the Twitter platform safer for users. In a move that will take place over the next month, ads for initial coin offerings (ICOs) and token sales will be prohibited globally. Ads for wallet services and crypto exchanges will also be banned.
It is feasible that the markets have overreacted to Twitter’s press release. Facebook and Google search volume dwarf Twitter’s. And there is no conclusive evidence that crypto newcomers are introduced via social media advertising at all. Also, a large number of Twitter ads have been fraudulent, as scammers try to impersonate well-known public figures like Elon Musk and Vitalik Buterin. The scammers typically post comments below a tweet, asking for a donation and promising to double the proceeds in return. In reality, funds sent to scam addresses are not returned. Some scammers have even recruited bots to comment and attempt to ascertain the scheme as legitimate. There is no doubt that Twitter and other social media platforms are better off without opportunistic crypto scammers.
Across the globe, South Korean conglomerates are gearing up for crypto. NHN Entertainment Corporation, the largest South Korean entertainment company, has reported that it helped fund the OKCoin exchange in China and will help launch OKCoin Korea. OKCoin Korea is slated to open soon and will feature 60 pairings of crypto with Korean won, expanding the menu of altcoins. Kakao, South Korea’s largest Internet firm, after launching the Upbit exchange last October, has been in talks with regulators about expanding Upbit and creating its own ICO. Nexon, the country’s largest gaming company, announced that it began in crypto and blockchain startups. SK Telecom, the largest telecommunications firm, invested in the Korbit exchange alongside Nexon and venture capitalist Tim Draper. Upbit will soon launch a crypto market index. The South Korean news should be a boon to crypto holders because it suggests that South Korea is becoming crypto’s biggest and friendliest national market once again.
Unfortunately, prices have reflected the bearish Twitter news but not the bullish South Korean news. Bitcoin (BTC) slipped under $8,000 on Coinbase/GDAX yesterday and today. Ethereum (ETH) fell to just under $460. Ripple (XRP) slipped under $0.60, Bitcoin Cash (BCH) tumbled under $900, and Litecoin (LTC) dropped under $140. Even as BTC increases its market capitalization dominance to an impressive 44.7%, it continues to feel downward pressure. Altcoins generally go into the red more, as BTC is considered a safe haven for crypto. Technically, the majors are all under the 200-day exponential moving average, and daily volume remains under the average, both bearish signs. As the majors continue to range, it seems that good news from South Korea is not enough. Perhaps only strong news that changes the fundamentals will be able to move price in a meaningful way.
Please leave a comment below to share and discuss your thoughts on Twitter’s ad ban and South Korea’s news.
The author owns a small amount of BTC and LTC.