Bitcoin six week low?
There was an interesting article in the Times today by James Dean that came connected to an Associated Press report from South Korea. The article produced here commented on recent developments in Bitcoin and others and their value.
Bitcoin plunged to a six-week low amid a widespread sell-off in digital currencies yesterday as governments warned of impending crackdowns. The combined value of all digital currencies in circulation fell from $711 billion on Monday to $509 billion last night, according to figures from Coinmarketcap. Digital currencies are made up of computer code and have no physical form. They became extremely popular among private investors last year as prices soared, leading to fears of a bubble as prices are extremely volatile. Governments across the world have warned people that they risk losing all their money if they invest. China and South Korea have stepped up their crackdown on digital currencies.
Bitcoin, the most popular digital currency, suffered its worst one-day fall yesterday since September, plunging to as low as $10,162, a drop of about 20.2 per cent, before recovering to $10,898. It hit a high of $19,666 in mid-December, but was trading below $11,000 at the start of that month.
Ether, the second largest digital currency, fell by as much as 23 per cent and Ripple, the third largest, dropped by as much as 33 per cent.
South Korea is one of largest markets for digital currencies and negative news can hit worldwide prices. Kim Dong-yeon, the country’s finance minister, said yesterday that “the shutdown of virtual currency exchanges” was being considered by the government.
The article on the face of it could be damning but there are one or two statements that could make you think twice. For example yes you could lose all your money but that could be the same for Forex or any other kind of investment. Cryptocurrency is the latest and because it is digital perhaps you need to be more aware of how you look after it.
Secondly the article mentions Bitcoin suffered it’s biggest drop since September 2017. This is true it went from $5000 to $2,900 on the 12th September. However it recovered to $5,600 a day later on the 13th. Not so unlucky then. Bitcoin then continued to rise to its maximum of $17,900 on the 15th December. In November it seemed to have its most stable 2 weeks hovering between $7000 to just over $8000 before surging to the December rate. By the 22nd December it again dropped to just over $13000 and as of the 17th January it was at $10,250.
You cannot take anything from the figures except that Bitcoin and others like Ether etc are still finding their place in the market and like normal currencies traders will find a place they feel comfortable trading at notwithstanding other influences. either way cryptocurrency is here to stay perhaps, for the moment, it is only for the most bold at heart.
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Frankie Hatton for the Acquarius Trust Group.