Bitcoin suffers its biggest plunge in a month

1 min readUpdated May 24, 2025Oct 20, 20172:52 AM

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Bitcoin’s price fell by the most in a month after US regulators signaled the cryptocurrency might come under more scrutiny. Other large cryptocurrencies, including ether and bitcoin cash, were also sharply lower.

A primer by the Commodity Futures Trading Commission said virtual tokens used in initial coin offerings, the process of launching digital currencies, were characterized as securities, which could bring them under its regulatory scope.

“There is no inconsistency between the SEC’s analysis and the CFTC’s determination that virtual currencies are commodities and that virtual tokens may be commodities or derivatives contracts depending on the particular facts and circumstances,” the report said.

On 18 October 2017, at 10:21 a.m. ET, bitcoin was down by 8.5%, to $5,125 a coin.

The volatile cryptocurrency has previously fallen on reports that China was closing local exchanges, though it quickly rebounded to nearly $6,000 a coin.

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What this means

The recent 8.5% Bitcoin plunge, triggered by US regulatory signals, shows the persistent volatility and regulatory uncertainty facing digital assets. This move pressures retail platforms and financial institutions in Asia that have embraced or are considering cryptocurrency integration, especially given prior price swings from China's exchange closures. Unlike traditional retail expansions by brands like Tiffany & Co. Or Chipotle's market entry in South Korea and Singapore, which rely on established regulatory frameworks, cryptocurrency ventures face an evolving and unpredictable landscape. The key risk lies in sudden definitional shifts by authorities, potentially classifying digital currencies as securities. The market must now watch for further clarification on the CFTC's stance on 'virtual tokens' and their commodity status.

Aiko Tanaka

Questions & Answers

What caused Bitcoin's price to fall recently?

Bitcoin's price dropped after US regulators suggested cryptocurrencies might face increased scrutiny. This included a primer from the CFTC characterising virtual tokens as securities, potentially bringing them under regulatory scope.

Which other cryptocurrencies were affected by this news?

Other significant cryptocurrencies, such as ether and bitcoin cash, also experienced sharp declines in value following the news about potential regulatory changes in the US.

How much did Bitcoin's price drop on 18 October 2017?

On 18 October 2017, at 10:21 a.m. ET, Bitcoin's price was down by 8.5%, reaching a value of $5,125 per coin.

Have there been previous instances where Bitcoin's price fell sharply?

Yes, Bitcoin's price has previously dropped following reports that China was closing its local exchanges. However, it quickly recovered to nearly $6,000 per coin on that occasion.

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