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Bitcoin bubble rises again after pre-Christmas dip

  • Posted by: Digital Marketing Tactic Team

Cryptocurrency heads back towards $16,000 after losing more than 30% of its value in one day and sinking as low as $12,000

Bitcoin bounced back over $16,000 on Boxing Day, recovering some of the ground lost in a pre-Christmas rout that pushed its price down below $12,000.


What is bitcoin and is it a bad investment?

Bitcoin is the first, and the biggest, “cryptocurrency” a decentralised tradable digital asset. Whether it’s a bad investment is the big question . Bitcoin can only be used as a medium of exchange and in practice has been far more important for the dark economy than it has for most legitimate uses. The lack of any central authority makes bitcoin remarkably resilient to censorship, corruption or regulation. That means it has attracted a range of backers, from libertarian monetarists who enjoy the idea of a currency with no inflation and no central bank, to drug dealers who like the fact that it’s hard (but not impossible) to trace a bitcoin transaction back to a physical person.

Bitcoin, the worlds biggest and best-known cryptocurrency, lost more than a quarter of its value in a single day, falling 30% at one stage on Friday to $11,159.93. Despite a late recovery, it had its worst week since 2013.

The digital currency had risen around twentyfold since the start of the year, climbing from less than $1,000 to as high as $19,666 on 17 December on Bitstamp and to more than $20,000 on other exchanges. However, it has posted heavy declines since.

While bitcoin investors and analysts believe the decline in its value was a natural correction after a heady run-up in prices, there have been further warnings from market regulators and central banks.

There is no right current price which would reflect the right current valuation, said Andrei Popescu, Singapore-based co-founder of COSS, which describes itself as a platform encompassing all features of a digital economy based on cryptocurrency.

Taking profit is right, while buying into a long-term projection is also right. You dont have to be right in this market, just less wrong than the rest, Popescu said.

Shmuel Hauser, the chairman of the Israel Securities Authority, said on Monday he would propose regulation to ban companies based on bitcoin and other digital currencies from trading on the Tel Aviv Stock Exchange.

Singapores central bank warned last week against investment in cryptocurrencies, saying it considered the recent surge in prices to be driven by speculation and that the risk of a sharp fall in prices was high.

Prices of rival cryptocurrencies, which slid along with bitcoin last week, have also recovered, with Ethereum, the second-biggest cryptocurrency by market size, quoted around $771, up from Sundays low of $689 but still far from highs of around $900 hit last week.

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Read more: https://www.theguardian.com/technology/2017/dec/26/bitcoin-bubble-rises-again-after-pre-christmas-rout

Author: Digital Marketing Tactic Team