Is It Time To Get Rid Of Your Bitcoin?
Cryptocurrency loses over 25 percent of value in less than 24 hours, dropping as low as $170 overnight
The price of Bitcoin has plummeted to its lowest level since November 2013, amid fresh fears as to the stability of the cryptocurrency.
It fell below the $200 mark for the first time in over a year, falling to as low as $173 overnight, although it has since recovered to currently sit at around $200, according to CoinDesk’s price index.
This marks a dramatic decrease from the highest valuation of Bitcoin at around $1,100 back in December 2013.
Troubled
The fall follows a number of major sell orders at a number of major Bitcoin exchanges around the world amid fears that the cryptocurrency could be reaching the end of its lifespan.
This has led to several industry observers stating that the Bitcoin bubble could well be about to burst, with prices set to return to the levels seen several years ago following its launch.
Nasdaq market analyst Martin Tillier suggested that the price of Bitcoin will continue to fall, mirroring similar bubbles seen in the gold and real estate markets in recent years.
“Why would the Bitcoin bubble of 2013 be any different?”, Tillier asked in his Nasdaq trading blog. “If anything, when looked at it as a deflating bubble, the drop in price has been fairly slow.
“Should the decline in exchange value continue to a point below the roughly $150 level that marked the last period of relative stability throughout most of 2013, then a case could be made that the real, underlying value of BTC was questionable before the jump.”
The volatility of Bitcoin has always been a risk for investors, especially following some high-profile exchange failures. Last week, UK-based Bitcoin exchange Bitstamp suspended its services after some of its operational wallets were compromised, resulting in a loss of almost 19,000 BTC worth £3.43m.
Last September, the Bank of England also cautioned that Bitcoin could pose a threat to financial stability in the UK should it see widespread adoption, due mainly to Bitcoin’s inherent volatility, restrictions on the number of coins in circulation, and the prospect of higher transaction costs.
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