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The bad year of Bitcoin has worsened even further, after it plunged over 12 percent amid a sell-off in digital currencies.
Key points:
- Several factors are behind the decline, including greater control by US authorities
- Analysts fear that the worst is yet to come
- The accident is the worst fall of bitcoin in 2011
The cryptocurrency dropped to $ US3,519.94 ($ 4,874) on the Bitstamp platform, after falling to a minimum of 14 months of $ 3,462.57.
It has lost 74 percent of its value so far this year, after reaching nearly $ 20,000 in December last year.
Bitcoin is finished?
Cryptocurrency market capitalization plummeted to $ 122.3 billion, down 85% from its peak of nearly $ 800 billion at the start of January this year.
Traditional investors remained outside the bitcoin, with concerns over poor regulatory oversight exacerbated by frequent price fluctuations.
Anthony Pompliano, founder and partner of the encrypted Morgan Creek Digital Assets, told CNBC that the latest incident is probably not finished yet, but remains optimistic about the bitcoin.
"Until 2017 all buyers were retail – as the price declines, start seeing institutional investors enter," he said.
The strong price reductions are seen by some as an opportunity to enter into feasible cryptocurrency projects at a discounted price, according to Donald Bullers, North American representative of the Elastos web3 infrastructure platform.
"Whether it's accusations of market manipulation, a controversial fork, or short-term speculators who decide not to play the long game, this dive will eliminate the wheat from the straw and major decentralization projects will continue to survive," he said. He said.
This is not the worst Bitcoin incident. Yet
But it's close.
In 2011, Bitcoin lost 92% of its value (falling from $ US30 to less than $ US2.50).
And then between 2013 and 2015, not long after having passed the value of $ US1,000 for the first time, it still lost 84% of its value.
Bloomberg reports that virtual currencies lost more than $ 700 billion in value from the market peak in January.
So, what is causing the accident?
Several factors have caused the latest dramatic collapse, analysts said, including greater scrutiny by US authorities.
They said the US Securities and Exchange Commission (SEC) was partly responsible for the recent sell-off, with the delay in approving the new bitcoin instruments, as well as for its investigation into initial coin offerings and crypto trade.
According to Aditya Das, an analyst with Brave New Coin, a company of asset market data, a postponed launch of bitcoin futures widely distributed by Bakkt, the cryptographic platform Intercontinental Exchange until January 2019, it has not been d & # 39; ;Help.
"These factors, together with the fundamentals of the tepid network and the reporting of a crypto as a tool for services such as payments, have led to strong selling pressures against the lack of purchasing resistance, up to a point of apparent capitulation, "he said.
Other digital currencies also fell sharply, with Ethereum ether down 7% and Ripple's XRP down 5.6%.
ABC / Reuters
Themes:
currency,
information and communication,
United States
