Bitcoin and Other Cryptocurrencies Are Plunging Today -- Why?

Bitcoin (BTC-USD) is down 10% on Wednesday, pumping the brakes on the digital currency's impressive rally over the past couple of weeks. Most other cryptocurrencies are down as well, although there really isn't any bad news that appears to be causing the drop. Here's a rundown of Wednesday's cryptocurrency prices, as well as how seven traders were able to buy bitcoin for free, at least for a short while.

Today's cryptocurrency prices

Here's a look at the 10 largest cryptocurrencies by market capitalization, and how much each has changed over the past 24 hours.

If it were just bitcoin (BTC-USD) that was pulling back, it could be attributed to profit taking or just a cooling-off of the recent rally. After all, bitcoin's price has risen from a low of $6,000 to a peak of well over $11,000 in just a couple of weeks. Even after Wednesday's 10% decline, the leading cryptocurrency is up more than 15% over the past week alone.

However, this is a broad cryptocurrency sell-off, as can be seen in the chart above. All of the top five digital currencies are down by double-digit percentages, and it is not until the 18th largest cryptocurrency (Tether) that one is in the green today.

Furthermore, Wednesday's sell-off is occurring without any major negative catalysts. There were a few minor international headlines concerning bitcoin regulation. Specifically, it was reported that local police in Bangladesh are cracking down on cryptocurrency users (cryptocurrencies are illegal there), and Fortune reported that Iran's stance on cryptocurrencies may be significantly tougher than previously thought.

Is bitcoin going to $0? It did on one exchange -- by accident

One of the stranger bitcoin stories to come out recently occurred in Japan, where cryptocurrency exchange Zaif experienced a glitch that listed the current price of bitcoin (BTC-USD) at $0, and seven people noticed and took advantage.

While all but one of these transactions have been voided as of this writing (and the seventh is in the process of being resolved), this comes after fellow Japanese exchange Coincheck was hacked and over $500 million of NEM coins were stolen.

Japan is the most active cryptocurrency market in the world, with 16 government-registered exchanges that plan to create a self-regulating body. Japan, unlike most countries, recognizes bitcoin as a legal method of payment and formally gave merchants permission to accept bitcoin payments in 2017.

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Matt Frankel owns Ethereum and Litecoin tokens. The Motley Fool has no position in any cryptocurrencies mentioned. The Motley Fool has a disclosure policy.