Major cryptocurrencies tumbled along with the U.S. stock market this week as investors scrambled to cover their positions.

Cryptocurrency prices plummeted Thursday, with nearly $13 billion of value disappearing in only a few hours. Bitcoin (BTC) fell to levels last seen in late September; late Friday afternoon it was down 0.02 percent at $6,289.82. Ether (ETH) was up 0.13 percent to $197.79. Bitcoin cash was down 0.06 percent to $445.39 late Friday. Ripple (XRP), however, rose 5.6 percent at 43 cents.

Falling With Stocks

The price drop and slight rebound in some cryptocurrencies mirrored what happened on the Dow Jones Industrial Average. The Dow closed Friday up 1.2 percent to $25,339.99 after two days of major downturns. The digital currency and stock market generally don’t run together but Nithin Eapen, chief investment officer at Arcadia Crypto Ventures in New York, tells ThirtyK investors with hefty positions in equities had to cover their positions and so were pulling out of cryptocurrency positions.

“Most of the people who are buying crypto also have some sort of exposure to equities,” Eapen said, and as stocks fell “they had to take the capital out of somewhere.”

He believes that for now, the digital currencies market is still well entrenched in a bear market, and one that could continue for a while. “I think it will last longer,” he said. “It can creep into 2019.”

In the meantime, Eapen has a close eye on governments across the globe as they mull over the idea of creating their own cryptocurrencies. Most recently, Quartz India  reported a panel of India’s finance ministry may soon recommend the country launch a government-backed cryptocurrency.

Ecuador, China, Senegal, Singapore, Tunisia have launched their own cryptocurrencies. Estonia, Japan, Russia and Sweden are among those reportedly exploring the possibility. Eapen says adoption would likely make investors question governments’ confidence in their national currency.

Cold Shoulder From Regulators

Also this week, the International Monetary Fund released a paper that suggested a guarded stance toward digital currencies. The IMF cautioned in a recent report the “continued rapid growth of crypto assets could create new vulnerabilities in the international financial system.”

Many crypto investors were hoping regulators embrace digital currencies, though that has not been the case. Market participants continue to wait for the U.S. Securities and Exchange Commission’s decision about whether or not to ultimately approve a bitcoin-based exchange-traded fund. So far the regulator has rejected or delayed 10 proposed ETFs. 

Another research report, out of the U.K., suggested bitcoin’s inability to rally could portend more negative news. U.K.-based Juniper highlighted bitcoin’s inability to rally as a hint of more bad news to come.

“If bitcoin cannot make gains in such favourable circumstances, then it is unlikely to prosper as and when these issues are resolved,” U.K.-based Juniper researcher Windsor Holden said in the study published Tuesday, as reported by CNBC. “We feel that the industry is on the brink of an implosion.”

Mark Dukas, an analyst at bitcoin.live, tells ThirtyK that a close of over $6,850 would give the market some short-term “hopium,” trader-speak for unwarranted optimism. More likely, though, is a continued drop. If the price slide continues, he said, bitcoin could creep as low as the high-$4,000 range.

The entire market, he said, needs to build a base trade sideways, or move around a range without forming any distinct trends, and then trend above its moving averages. “When this happens, the bull market will return,” he said. Otherwise, “it will be a cold Fall.” 

Deborah Lynn Blumberg is a Houston-based freelance writer specializing in business, finance and health and wellness. Her work has appeared in publications including The Wall Street Journal, Barron’s, MarketWatch, The Christian Science Monitor and Newsday. Previously, she was a reporter at Dow Jones/The Wall Street Journal.