In today's market, when the Bitcoin price dips, the rest of the cryptocurrencies tend to follow suit. Photo: iStock
The lowest yuan/dollar daily reference rate in more than a decade seems to have sent traders flocking to Bitcoin. Photo: iStock

Just when analysts and industry observers were thinking cryptocurrency markets had bottomed out, they have crashed again.

Yesterday’s crash was a rude awakening for cryptocurrency traders after almost three months of inactivity and consolidation. With a fall that saw over 25 billion dollars flood out of digital currencies, markets have reached another new low point for the year.

Bitcoin quickly set the trend when the digital avalanche began yesterday at around 14.00 UTC as it fell through month-long support levels at $6,300. Within an hour it had dropped below $6,000 and within four hours Bitcoin had crashed to its lowest level in 13 months when it dipped to $5,550, according to analytics website The daddy of digital currencies rebounded to settle in the $5,650 price range, where it currently trades.

Being predictable digital lemmings, the rest of the altcoins followed suit and crashed even harder. Ethereum, which has fallen hard all year, dropped almost 15% over a 24 hour period, taking it to $175, its lowest level since mid-2017. The fall has also lost its second place in the market capitalization charts to Ripple’s XRP token, which only shed 10% in the recent rout.

One of the biggest losers has been Bitcoin Cash which lost over 18% on the day. The Bitcoin offshoot is due to hard fork today which usually drives momentum as traders load up in anticipation of getting an equal amount of tokens from the new fork when the blockchain splits. This hasn’t happened, with BCH also hitting a 13 month low at below $420.

Nearly all cryptocurrencies have made double-digit losses in the past 12 hours. Some of the biggest drops have been for Cardano, Monero, Iota, Ethereum Classic and Zcash, all plummeting over 15% on the day.

There is of course a lot of speculation as to what caused a crash which followed several months of relative stability in cryptocurrency markets. Some believe it is related to infighting over what happens next as Bitcoin Cash, the fourth biggest crypto-currency, prepares to “hard fork” while others are saying crypto needs a final purge before the bulls get back in to spark a rise into 2019.

Either way, over $25 billion has left the space in just a few hours marking 2018’s biggest single crash of over 11% in less than a day, and the lowest price level most virtual currencies have been at for well over a year.