Volatile Bitcoin Takes A Dive
Thousands of dollars wiped off value of cyber currencies as one exchange suspends trading
The volatility of cyber currencies, now in wide use in the online gambling industry, was dramatically illustrated Friday as Bitcoin prices plunged over 30 percent, triggering a domino-effect among other crypto-currencies available on the unregulated market.
The Telegraph newspaper reported that Coinbase, a major cyber currency exchange, has temporarily disabled buying amid a massive sell-off following Bitcoin’s price plunge.
“Due to today’s high traffic, buys and sells may be temporarily offline,” the exchange informed its users Friday. “We’re working on restoring full availability as soon as possible.”
The epic Bitcoin dive came after the cyber currency topped $20,000 – an all-time record – last Sunday; by Friday morning it had tumbled down to $12,560.
Techcrunch reported that the losses have been severe, commenting that the price plunge represented the highest percentage loss of value that bitcoin has seen this year. Other Friday free falls in the crypto-currency market included Ethereum (down 20 percent), Bitcoin Cash (down 30 percent), Litecoin (down 21 percent).
The cryptocurrency was valued at just $998 on January 1 2017.
When InfoPowa went to press Saturday morning analysts were still debating on the safety of the cyber currency, with the more pessimistic suggesting the crash could herald the bursting of the Bitcoin bubble.
Others opined that the virtual currency was on the cusp of a bear market, whilst some took a more bullish view, pointing to the historical volatility of the decade-old currency and speculating that short term speculators were bugging out, but that many investors in it for the long haul were still in positive ROI territory and would remain in the market.
“We see the exit of short term speculators and we have seen it before. The fundamentals are still in place and there is no reason why the bitcoin ecosystem should not continue to develop,” one analyst commented.
Despite plenty of opinion and speculation, no one seemed to be able to identify a specific and credible reason for the sudden panic.
Bitcoin Begins To Recover One Week After Crash (Update)
Value passes $16,000 as cyber-currency rebounds
Last Friday’s spectacular 30 percent plunge in the value of the hitherto booming Bitcoin cyber-currency, which saw it retreat from almost $20,000 to just over $10,400 (see previous InfoPowa report) has been ameliorated by a rebound to just over $16,000 on the Coinbase exchange on Wednesday 27 December.
Rival currencies litecoin and ethereum were up 4.4 percent and 2.6.
Coinbase claims that the recovery has been over 50 percent since Friday’s low of $10,400. Since the beginning of this year Bitcoin has risen 1,500 percent, creating an apparently self-sustaining but volatile boom in the virtual currency despite warnings from experts that it may be a bubble set to burst.
There has still been no immediate explanation behind the extreme volatility in price shifts, much of which has come with the introduction of Bitcoin futures trading earlier this month.
Observers are now awaiting the potential fall-out likely to occur from a second “fork” in Bitcoin labelled the SegWit2x Bitcoin (BTC) hard fork, which is scheduled to go ahead as planned on Thursday December 28 (at block 501451), following an initial delay.
News that proponents of a controversial “hard fork” had suspended their plans back on November 8 sent the price of Bitcoin skyrocketing.
The project’s Founder and Lead Developer, Jaap Terlouw, says that the fork aims to address issues of “commission and transaction speed within the Bitcoin network,” adding that currently, Bitcoin is “almost impossible to use as a means of payment.”
Eight exchanges are listed as official supporters of the fork.
Bitcoin Cash, which came out of the first hard fork back in August, has seen substantial growth.