The activity of the regulators has a significant impact on the price of the cryptocurrency market as a whole, according to a new study.
The Bank for international settlements (BIS), the founders of which included 60 of the largest Central banks in the world, presented a report on how the cryptocurrency market is reacting to the news.
BIS believes that the cryptocurrency markets that rely on regulated financial institutions and digital currency are within the reach of national regulation. The researchers also say that there is news that the cryptocurrency market reacts more noticeable than others. For example, the news about the ban of digital currencies or serious change in the legal regime in relation to them have a greater effect compared to other news:
The market also reacts to the news related to money laundering and the financing of terrorism, and the limits for cryptocurrencies on the regulated markets. News indicating that a specific legal framework for cryptocurrencies and ICO are directly linked to the profit on a stable regulated market.
The report highlights the various factors and news that affect the cryptocurrency market or, on the contrary, they are ignored.
First, the market reacts most strongly to the news related to the legal status of digital currencies. This is especially true of prohibitions, including ICO. Second, the big impact news from regulators on the implementation of measures against money laundering and financing of terrorism, as well as about the limitations of the use of cryptocurrency in the traditional financial systems. For example, this applies to applications Cboe to bitcoin ETF.
On the contrary, the price is not affected by the alert authorities about the dangers associated with the use of cryptocurrency, or the reports about the possible release of digital currencies by Central banks. In addition, the BIS survey indicates price differences in different jurisdictions that, in the opinion of the authors of the document demonstrates segmentization market.
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