After a week of robust gains in the cryptocurrency market, the No.1 digital asset, bitcoin, has run into resistance as industry headwinds put its recent rally in jeopardy.
“Bitcoin seems to be facing difficulties in moving beyond $9,000. The increase in mining complexity and the peak output of new capacities to the market at the end of 2017 have led to miners facing several issues after price correction,” FX Pro said in a morning report Tuesday.
The price of a single bitcoin
reached an overnight high of $8,973.12 before slipping back, finishing the New York session down 2.3% at $8,685.65, according to CoinDesk.
Elsewhere, Ether, which runs on the Ethereum network, fell 2.3% to $853.45, bitcoin cash was last traded at $1,249.72—down 3.5%, Litecoin slipped 1.8% to $160.24 and Ripple is down 4.9% at $1.04.
Regulatory issues are back in the spotlight after news that seven of the largest cryptocurrency companies have come together to form a self-regulatory body in the U.K. CryptoUK, whose members include the popular Coinbase exchange and various trading platforms said it has produced an industry code of conduct that they hope will be widely adopted.
“We’re extremely proud to have brought together some of the leading players in the sector. This association is not only about exchanges, we represent the whole crypto sector, apart from ICOs. All of us are unified by a desire to grow in the U.K. and for the need for collaboration with government on what our future operating environment looks like,” Iqbal V Gandham, chair of CryptoUK, said in a statement.
Elsewhere the European Central Bank said that the regulation of bitcoin is not its problem, and went on to warn investors that the extreme volatility and the lack of a tangible backing makes it a risky tool for investors.
Read: Bitcoin’s key problems illustrated by the ECB, in one simple chart
On the futures front, the February bitcoin contract on Cboe Global Markets
closed down at $8,685, shedding $150, or 1.7%, while the CME Group Inc. contract
was trading flat at around $8,615, down less than 0.1%.