Bitcoin value has plunged to its lowest level since mid-November, sliding down to below $6,000 on Tuesday.
The cryptocurrency fell 13 percent, before recovering slightly in a worrying start to 2018. Since the strong gains the previous year, Bitcoins have tumbled sharply with concerns surrounding regulatory clampdowns.
On 5 February, Lloyds Bank (LON: LLOY) and Virgin Money (LON: VM) announced a ban on buying cryptocurrencies using customer credit cards.
Both groups said they were taking action over concerns that credit card customers were gambling on making big profits but unaware that they will face large debt if the price falls.
Theresa May has expressed equally doubtful concerns over Bitcoin, likening it and other cryptocurrencies to criminal activity.
In other forms of the crackdown, Facebook (NASDAQ: FB) announced plans to ban adverts for cryptocurrency on their social media platforms after complaints of scams and hoaxes found on newsfeeds.
“Misleading or deceptive ads have no place on Facebook,” said Facebook’s product management director Rob Leathern.
“We’ve created a new policy that prohibits ads that promote financial products and services that are frequently associated with misleading or deceptive promotional practices, such as binary options, initial coin offerings and cryptocurrency.”
The increasing global regulation and crackdowns are affecting the virtual currency, which grew in value from $900 to $20,000 in 2017 alone.
This decision by Lloyds and Virgin Money follows warnings by regulators and ministers in many other countries including the US, South Korea, China, Russia, India, Germany and France over the market.
“There are great concerns regarding virtual currencies and [the] justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges,” said Park Sang-ki, South Korea’s justice minister.
“Some officials are pushing for stronger and stronger regulations because they only see more (investors) jumping in, not out.”
Ethereum, is the second largest cryptocurrency and has dropped by almost percent in the last 24 hours – the worst performing virtual currency on the market. Ripple is also performing badly and is down 2percent.
According to the cryptocurrency site CoinMarketCap, all of the top 80 largest cryptocurrencies have dropped by similarly dramatic amounts in the past month.