On Wednesday, Cardano’s ADA token fell to its lowest price in over three months. Popular retail-trading platform eToro announced plans to delist the cryptocurrency in the United States due to regulatory concerns. It makes ADA the latest victim of the nascent crypto market’s murky regulatory waters.
ADA’s Key facts
According to the crypto statistics website CoinMarketCap, the price of blockchain Cardano’s ADA token dropped more than 9% to $1.60 by 2:00 p.m. ET Wednesday. It was putting the token about 49% below its all-time high of $3.10 set in September. The sharp drop began on Tuesday. Shortly after eToro, one of the world’s largest exchanges for retail traders, stated delisting of ADA and Tron tokens in the United States on December 26. It prevented users from purchasing them and receiving incentives.
According to eToro, the modifications were made owing to business-related considerations in the shifting regulatory environment. Which also stated that customers would be able to sell any tokens they already own.
Cardano founder Charles Hoskinson railed against the decision. He was blaming it on the lack of a global regulatory standard governing how cryptocurrencies should list exchanges and attempting to allay fears that the price of ADA would be impacted. Which he described as a byproduct of fear, uncertainty, and disinformation.
Other cryptocurrencies fell with ADA on Tuesday, with Tron, a smaller token with a market capitalization of $7 billion, down 6%, while Sol, Polkadot, and Dogecoin lost 8%, 6%, and 5%, respectively. Despite plummeting this month, ADA’s stock has soared 800 percent this year and now has a market worth of $54 billion, compared to over $95 billion at its peak.
ADA’s Quote of Interest
According to Hoskinson, co-founder of Ethereum, this is the essence of the game, and regulatory clarity is the only way to fix this. Because the cost of U.S. exposure is high, he continued. He is referring to eToro’s European domicile and claiming U.S.-based exchanges, like Coinbase, are already paying for regulatory compliance and thus have it far easier to comply with domestic regulations.
Tangent
A wave of government crackdowns began in 2017. It resulted in an 80% drop in cryptocurrency values and a years-long bear market that lasted until the pandemic. Concerns have roiled markets multiple times in the past year. The value of the world’s cryptocurrencies plummeted by as much as 45 percent this summer. This was due to increased controls in China.
What to Watch For
In a long-awaited study released this month, a group of President Joe Biden’s top economic advisers urged Congress to implement regulatory oversight and a formal market structure for cryptocurrencies as soon as feasible. As a first step, lawmakers included a contentious clause in the recently adopted infrastructure bill. It mandates bitcoin exchanges to disclose transactions exceeding $10,000 to the Internal Revenue Service.
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