Japan Cracks down on exchanges, causes market crash

Japan’s financial regulators today issued warnings to six major Cryptocurrency exchanges to make improvements to their anti-money laundering systems. This, in turn, caused the digital currency market to drop by as much as ten percent.
This actually never made that much sense to me why regulation always makes the market drop and why people are so afraid of regulation. Regulations are necessary for the cryptocurrency markets to grow as only a stable market without many of the tax evasion and money laundering concerns will get many big vendors to start adopting cryptocurrency. If we ever want cryptos to be accepted in real world use, these are necessary steps.
I also believe that cryptocurrency futures markets have massively hurt the price of cryptos ever since they came online late last year. Bitcoin reached its high basically right before they came online and has been declining every since. I feel like short-selling futures is the culprit here as when bad news come out, not only do people sell physical bitcoin, they also short sell bitcoin on the futures market that they don’t actually have. We’ve already seen the effects of what happens to cryptocurrency price once one of those large short positions gets liquidated. It happened more than a month ago and the price of BTC jumped $1000 almost immediately so I do think large short positions have a large impact on price and is part of the reason we are still in a bearish market. There should be regulators looking into manipulation on the futures markets because I think that is where most of the illegal action is.

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