Bitcoin is Crashing, Has the Bubble Popped?

Bitcoin Picture

Bitcoin/CC

The price of bitcoin fell Wednesday under $10,000 for a bitcoin on Wednesday, a level not seen since early December.

Around 5:00 on Wednesday, the price of bitcoin has fallen to 9,730.42 dollars for a bitcoin, its lowest level since December 1 and a fall of nearly 50% since its historic peak of December 18, according to figures compiled by the Bloomberg financial data provider.

Bitcoin was worth a few cents at its launch in February 2009 by one or more computer scientists hiding under the pseudonym of Satoshi Nakamoto. Last the cryptocurrency saw meteoric rise, going from around 800 dollars in January of 2017 to nearly $20,000 in December.

Due to this exponential growth and the constant fluctuations of its price, many analysts and experts have called Bitcoin a Bubble and governments around the world are starting to express their desire to regulate the crypto market.

Bitcoin is not the only cryptocurrency affected by the massive drop. All the major coins, including Ethereum, Bitcoin Cash, Ripple and Litecoin have also seen double-digit percentage of decline. Ethereum, Ripple and Bitcoin Cash have lost respectively 23.53%, 27.86% and 21.71% over 24 hours, while bitcoin was down 16.54% over the same period.

Bitcoin, a peer-to-peer payment system, is present on specific trading platforms and not on regulated markets. It has no legal tender and is not governed by a central bank or a government, but by a large community of Internet users.

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Its strong point for his supporters is that it can not be subjected to the temptation of the “printing press”, but it’s critics emphasize its opacity and extreme volatility, denouncing the creation of a speculative bubble.

“Speculative investors are leaving the ship,” said Craig Erlam, an analyst at Oanda.

“This is not to say that bitcoin will collapse, but the warning signals of recent weeks have been confirmed,” continued the analyst, for whom we must now see how long crypto-currencies will take to regain a foothold.

According to analysts, the fall of bitcoin is explained in particular by the indications of a hardening of the authorities with regard to crypto-currencies, in particular in South Korea and in China.

The South Korean government said last week that Seoul was preparing to ban cryptocurrency trading platforms, before backtracking and saying it was only one of the measures being considered by the Ministry of Justice.

South Korea is home to some of the biggest bitcoin exchange platforms and a ban there would disastrous for the Bitcoin infrastructure.

The markets are also affected by rumors that China is preparing to implement a complete ban on bitcoin mining.

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Eddy Shan

Eddie, a passionate video-game player focuses mostly on tech and science related new for The Talking Democrat