Bitcoin Sees Major Drop In Price

Bitcoin prices dove sharply on Friday, December 22nd. The cryptocurrency lost over 30% of its value in a single day. This was after a year of record gains that...

Bitcoin prices dove sharply on Friday, December 22nd. The cryptocurrency lost over 30% of its value in a single day. This was after a year of record gains that shot its value to tens of thousands of dollars per bitcoin. The steep drop from $17,500 to 12,000 in a span of only 24 hours caused a panic in the newly emerging cryptocurrency markets.

Bitcoin was not the only currency to drop in value on Friday. It took other new cryptocurrencies with it. Cryptocurrencies such as Zcash, EOS and Ethereum took an even sharper dive in prices than Bitcoin did.

The sharp decline of Bitcoin’s price in a day has raised the issue of Bitcoin and cryptocurrencies in general being a bubble. A securities regulator in Massachusetts highlighted the high volatility of Bitcoin. Others take an even more pessimistic view of Bitcoin. They claim that it is backed up by hype and that it will bust.

If you look at the history of Bitcoin, then you will that it has had several booms and busts already. The first boom drove prices to $200 a coin before crashing. Another boom in China brought Bitcoin up to $1,200 before crashing yet again in value. The latest drop can be said to be just another crash in Bitcoin’s history. A key question that investors will no doubt have is when will the next boom and the next bust occur.

Bitcoin has made some people rich. Brothers Cameron and Tyler Winklevoss invested early on in Bitcoin when it was relatively worthless. Their Bitcoin holdings are now worth at almost $1 billion dollars. This is even with the latest 30% drop in value.

Other people have fared worse when it comes to Bitcoin. Vadim Semenov invested tens of thousands of dollars into Bitcoin but lost out on his investment. He bought Bitcoin when it was priced at only $700. When a bust came, he sold it for around $300 and lost $400 per Bitcoin. Vadim Semenov has since reinvested money into Bitcoin again. He says that the steady rise of Bitcoin has convinced him that it is a safe investment. Unlike last time, he has decided to not sell during the bust cycle. He says he will instead hold onto his Bitcoin assets and wait for them to rise.

The crash in Bitcoin’s value on Friday has dissuaded some institutional investors from entering cryptocurrency. One Goldman Sachs investor said he was cancelling his plan for an investment company that focused on cryptocurrencies such as Bitcoin. The crash and drama that follows is not worth it he says. This investor also said that he thinks Bitcoin will see another plunge in value soon. A few things that are certain for now is that Bitcoin has a lot of interested parties. It is also extremely volatile and should only be invested in with those who have spare cash.

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Cryptocurrency

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