Crypto investors are seeing red this week. Bitcoin plunged to two-month lows on Thursday, dipping below $9,000 for the first time since November. At the time of writing, Bitcoin had ricochetted back up to the $9,200 level, down from weekly highs simply above $12,000. This week has seen coins across the board in the red — a sign that investors are jumping ship to fiat currencies this time instead of swapping into altcoins as we’ve seen in the recent past.
At the time of writing, the total cryptocurrency market cap weighed in at $459 billion, down from January highs around $830 billion. It’s a contraction to be sure, but not a low for the last 30 days( that low came on January 18 ).
Is this the bitter end for Bitcoin? For cryptos? Well , no, probably not. Get your head bolt on right and you’ll should be noted that( for better or worse) many coins have watched unprecedented growth in the last six months to a year, even with Bitcoin’s price halved from holiday highs closer to $20,000. On the working day last year, Bitcoin was sitting pretty at $982. At the height of December’s craze, most reasonable crypto-watchers could agree that the price was overheated and there was only one way for it to go in the short term. Still, in the thick of the present correction, Bitcoin’s longer-term growth is anyone’s guess.
Cryptocurrency die-hards expecting the price to bounce back, even partially, “il be seeing” these tanking numbers as the perfect entry phase for getting in low and maximizing gains. Late speculators who got in during the mass crypto hysteria of the holiday season aren’t likely to have such steady hands, a factor that’s likely contributing to the slide.
So what’s causing the slide to begin with? As usual , no one thing can be blamed for Bitcoin’s current downturn, but recent skittishness around a subpoena for Bitfinex and fears around Tether — a kind of cryptocurrency equivalent to USD that matches the dollar one to one — likely taken into account in. Recent news that Facebook would ban ads for ICOs probably didn’t help either. And it seems like every day a new Ponzi scheme gets busted, hurling yet more doubt on the credibility of plenty of less than legit ICOs.
Even beyond news cycle highs and lows, Bitcoin has seen a few mid-January dips before, though 2017 ’s Bitcoin behavior surely broke from any seasonal patterns of the past.
Still, these growing aches are far from surprising. As cryptocurrencies mature — assuming they continue to do so — regulatory “bad” news will become more common. Countries across the globe will continue to struggle to accommodate their citizens’ sudden those who are interested in digital currencies — or not, in the case of India, which simply decided to ban them outright. Unsurprisingly, headlines like these inspire a sense of premonition among cryptocurrency fanatics wondering which country will be next to come down hard. Fear, perhaps justifiable anxiety for many speculators with plenty to lose, amplifies each new regulatory revelation. But for cryptocurrencies to grow out of the present scam-laden chaotic epoch, a thorough house cleaning is healthy.
Bitcoin and other cryptocurrencies have also looked less responsive to positive news in the latter half of January compared to their relative buoyancy during December’s dizzying highs. Then, every little positive news blip seemed to push the prices higher.
Bitcoin aside, some altcoins might just be adjusting from overheated, overhyped December highs. Ripple is an excellent example of this, hovering around$ 1 Thursday, a price that’s five times its November value and only seems bad after XRP flew a bit too close to the sunshine with sudden early January highs above $3. Ethereum is also faring pretty well, all things deemed, down from all-time highs above $1,400 but holding most of its newly built value after doubling in price from December costs around $500.
It’ll be interesting to see what happens as we move into next week’s Senate Banking Committee hearings on cryptocurrency. Titled “Virtual Currencies: The Oversight Role of the U.S. Security and Exchange Commission and the U.S. Commodity Future Trading Commission, ” the open hearings will air on February 6 at 10:00 Eastern day. It’s possible that the upcoming discussion in Congress has traders nervous, but ultimately variables from all over the globe combine to affect the market every day.
For anyone considering riding out the present correction, a little historical view — in this case, even a few months’ worth — could go a long way.
Disclosure: The writer holds a small posture in some cryptocurrencies. Regrettably, it is not enough for a Lambo .
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