Cryptocurrency has been the hot topic in the financial space for some time now. While these digital coins climbed in value for some time, more recently, stories have been negative, and we’ve some serious declines. Just about every cryptocurrency has been falling from Bitcoin (BTC) to Ethereum (ETH), Ripple (XRP), Litecoin (LTC) and everything in between. The decline continues today. So, what’s the deal? Well, there are three big stories that are causing the declines in the cryptocurrency space. Here’s what’s going on:
Chase Recognizes Cryptocurrency As Cash, And Not In A Good Way
One big issue for cryptocurrency that has come out recently is that credit card companies are starting to classify coin purchases as cash transactions. There have been quite a few people buying BTC, ETH, XRP, LTC, and just about any other cryptocurrency using their credit cards; hoping for big gains in value that outweigh the cost of interest on the credit card.
To combat this, Chase recently announced that it would be classifying cryptocurrency coin purchases as cash advances. In the credit card world, this is a slap in the faces of altcoins. Why? Well, because cash advances come with a far higher interest rate, generally well over 20%. As a result of this, those interested in making money with cryptocurrencies like BTC, ETH, XRP, LTC and others are less likely to do so with the funds available on their credit cards. This means that demand for cryptos is likely to continue falling, at least demand from those using credit cards to purchase altcoins.