Before your going to invest in any of the digital assets, whether its Bitcoin or any other cryptocurrency, it’s quite significant to get familiar with certain price analysis associated with that very one. Like there are different aspects regarding the same such as rise and fall, causes and effects, and its ramifications.
If we talk about Bitcoin (BTC) then in the recent past it encountered a lot of ups and downs, starting from the month of January and December 2018, where it surges up to almost $20,000 from $1,000. However, in the month of January 2018, it dove 50% following the previous month’s hike.
And now after a crash of $7,300 a couple of weeks back, it reinstated at $6,500.
While many have seen it coming however it intimidated quite a lot of potential investors regarding the 2017 price drop which was however predicted for a month. Although Bitcoin (BTC) reassured its community about the strength. But the community often tends to ignore the fact that Bitcoin went through several crashes in 2011, 2013 and 2017. Also, they ignored the warnings of analysts and economists like Paul Krugman and David Stockman. Amidst the hype, Bitcoin price climbed to unsustainable levels.
Talking about its causes and effects, behind the 2017 rally of Bitcoin that’s partially fueled by manipulation was regarded to Bitfinex crypto exchange.
It was also found in reports that to hike the price higher Bitfinex allegedly utilized Tether, a cryptocurrency that it owns.
Tether is backed by the equivalent of U.S. dollar reserves. Although, it was noticed that half of the bitcoin price surges up drastically as soon as the Teather was released to other exchanges.
The U.S. Commodity Futures Trading Commission sent subpoenas to both Bitfinex and Tether in December 2017. Considering the fact that manipulation might have lead to fuel the Bitcoin surge, it’s conceivable why the cryptocurrency crashed.
The crash of Bitcoin (BTC) has created a lot of skeptics among the regulatory environment which turned out to be a subject of regulations.
After all the regulators let the potential investor know that there is a certain risk factor associated with other cryptocurrencies, they remained largely on the sidelines during the Bitcoin price rally.
Even though there have been relentless crashes going on in the Bitcoin arena, which lead to a horrifying situation for almost every crypto community, however, it was less certain that the rest of the world wasn’t that much shocked about this incident, on that note taking a non-crypto community into account would be quite essential in terms of cause and effects.
Although it’s worth to note that the drop in Bitcoin price affected the net worth of some major investors. Moreover, it is also plausible that it created a lot of hype when the cryptocurrency was growing, people who invested when bitcoin price was high undoubtedly lost money.
However, the price drop also brought the cryptocurrency to a less volatile state making it quite sustainable. Which makes Bitcoin(BTC) least volatile in comparison to other such currencies, but it also enjoys enough liquidity to be a good investment.
The Cryptocurrency market encountered a lot of ups and downs in the recent past which however didn’t boil down the trust factor away from Cryptocurrency. Although it is still regarded as the largest market capitalization. One thing has to be admitted here that the price fiasco has to lead pretty much other cryptocurrencies down with it, the cryptocurrency market remains to be strong. Apart from that, it also doesn’t deter investors from the ICO market, which hit record levels in 2018.
Overall, the Cryptocurrency especially the Bitcoin community remained loyal and invested despite the price drop frightened some potential investors.
- Bitcoin Cash(BCH)$139.13