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Cryptocurrencies Recover Slightly After Two-Day Selloff

Samson Ononeme | Nov. 16, 2018
Cryptocurrencies Recover Slightly After Two-Day Selloff

The price of major cryptocurrencies have bounced back on Friday morning after a two-day sell-off dragged the flagship cryptocurrency to a one-year low. How are they currently trading?

November 16, 2018 | AtoZ Markets - Cryptocurrency market has calmed down and even major cryptocurrencies have regained some ground on Friday morning in Asia after the epic two-day sell-off on Wednesday and Thursday drove Bitcoin (BTC) price to a one-year low.

Although the market is still feeling the impact of the crash that occurred earlier this week, the total market capitalization of digital assets has risen slightly and is currently registered at $186 billion as against $184 billion during this time on Thursday.

Crypto Prices Regain Some Ground After Two-Day Selloff

Bitcoin, the largest virtual cryptocurrency rose slightly on Friday morning by 0.01% to $5,710.80 on the Bitifinex exchange. Meanwhile, Ethereum (ETH), now the third largest virtual coin with market capitalization valued at $18.5 billion edged up 1.1% and is trading at $183.12 and now moving within a short-term bullish trend on the Bitifinex exchange.

Moreover, it is worthy of note that Ripple (XRP) has ousted ETH from the second position in the rating of top-10 cryptocurrencies. XRP gained 4.3% in recent 24 hours and now has a market cap of $19.2 billion and is currently changing hands at $0.4788. The short-term upside trend is gaining traction, nevertheless, $0.4900 level may halt the price recovery for the time being.

Shifting gears, the crypto market collapse has also caused a decline in the values of chip designers shares as a demand for graphics chips plunged.

Nvidia Third-Quarter Earnings Report Discouraging

Nvidia third-quarter earnings report may tell a story of what's happening in the crypto industry. The shares of U.S. chip maker Nvidia (NASDAQ: NVDA) fell as much as 19% on Thursday after the company reported a drop in the third-quarter revenue which missed the expectations.

According to CNBC, the firm's forecast for the fourth-quarter revenue of $2.7 billion, was revised to the downside.

While Nvidia is one of the biggest manufacturers of graphics chips for gaming artificial intelligence and machine learning, the firm has capitalized on the rise of cryptocurrency mining in 2017.

The Demand for Graphics Chips Plunge

The demand for Nvidia's high-performance gaming cards strongly intensified as the prices for cryptocurrencies skyrocketed. However, now that virtual coins have sunk in value, the company is left with inventory overload. In a Thursday press releaseNvidia CEO Jensen Huang is quoted as saying:

"Our near-term results reflect excess channel inventory post the crypto-currency boom, which will be corrected."

The company expects that the downward pressure caused by the bearish trends in the crypto industry will be short-lived, and eventually, the gaming chips will find their buyers. Still, experts have warned that it won't be a smoth ride taking the inventory levels back to normal because of the increased activity on the secondary market of chips.

After the company announced its results, Nvidia's chief financial officer, Colette Kress, told analysts on a conference call:

"Our Q4 outlook for gaming reflects very little shipment in the midrange Pascal segment to allow channel inventory to normalize."

Bitcoin Mining Giant Canaan Lets Its IPO Application Expire

In another development, one of the world's largest Bitcoin mining hardware makers, Canaan Inc. has let its application in Hong Kong for an initial public offering (IPO) expire on Thursday, thus, casting doubt on the futures of other Bitcoin mining gear providers.

As per Reuters, the Hangzhou-based mega-seller of cryptocurrency mining equipment allowed the IPO worth at least $400 million to run out of steam amidst regulatory uncertainty in China and Hong Kong. At the same time, the IPO had been already reduced from an original plan to raise $2 billion on the Hong Kong’s bourse, thus, suggesting a lackluster outcome for those involved.

In addition, Reuters further mentioned sources as claiming that the IPO will not happen in 2018 based on updates from the nation's stock exchange regarding a listing hearing. The IPO application expired after the Hong Kong’s securities watchdog stated it would impose licensing conditions on companies that manage investments in virtual assets.

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Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.