We have seen major changes in the crypto market in the past couple of weeks with new coins appearing with every passing day and some dips and highs. But nothing was more flabbergasting than the astounding plunge Bitcoin went through and other cryptocurrencies as well as a result, and yet the bounce it got the very next day!!
But what is more intriguing here is that either ways, the plunge and the bounce have acted as a win win for certain investors. Before going on as to how, a little overview of what happened in the past couple of days; the soars and the dips an exciting mix for you on the platter.
A dip down the lane
Bitcoin was trading at $11,000, a fall of 45 per cent in five days.
The week has been a bummer for Bitcoin, for the value of the coin has depreciated owing to the cyber attack and the busting of the cryptocurrency exchnage in South Korea.
Such trends in the prices caused Coinbase, a major currency exchange, to say that it would definitely look into the disruption and the sharp price increases of the cryptocurrency in the market. The senior market analyst, Neil Wilson, said: “Has the bubble finally popped? It’s hard to see the bell tolling just yet.”
“Large price swings have become so normal that it’s hard to decide – we can easily see this market bounce back in very short order.”
While Bitcoin made a whooping soar of $19,800 on Sunday, it followed a sharp decline making it trade for $15,500 for most of the following Thursday. And this was further aggravated, when due to one reason or another in the afternoon on Friday, the value of Bitcoin dropped to a low of $10,400 according to Coinbase. But later recovered the very afternoon for $14,600, 27 percent from the all-time high.
As of now, there isn’t much intel on the reason for the sudden decline and the surge ; the selloff and the volatility.
Bitcoin Cash trading was suspended earlier this week, while it looked into the plausible reasons behind the fluctuations following Bitcoin.
Three exchanges stopped trading altogether after Friday’s fall. According to Coinbase the trading was halted as a consequence of a technical issue in the systems which were the result of extremely high traffic. Nevertheless, the trading was reopened and the prices recovered till then to $13,000 (£9,700).
This drop inevitably effected the value of other cypto coins in the market. The reason for the drop was probably the panic which led to mass selling thinking that the Bitcoin bubble was about to burst.
The ones which fall shall Rise
The recovery for the market was a speedy one, after 24 hours of experiencing plunge owing to a correction, every single cryptocurrency which suffered the shock, the crypto market completely recovered.
As of today, on December 23, all cryptocurrencies in the market from bitcoin to the top 100 cryptocurrency have surged in value. Bitcoin Cash to be more specific, for it had increased by 52 percent overnight and hence stood amongst the top 20 crypto coins to increase in value.
Others including bitcoin, Ethereum, Ripple, Litecoin, Cardano, and Dash have all increased by more than 20 percent.
What was interesting in all this was that the analysts observed a regular trend in the rise and falls of the Bitcoin. According to Alan Silbert and Robert Reid the trend was that for every dip of more than 30 percent Bitcoin faced in 2017 (at six occasions) the correction that came along always resulted in a significant gain in value for the coin.
A shocker, isn’t it? Nevertheless, as long as people benefit, a dip or a soar anything can happen.
What’s in it for you
Well before going into the delicate details; let me be clear and simple. The plunge, although very shocking, came as an opportunity for those who wanted to buy Bitcoin, but couldn’t do so due to the skyrocketed value. Similarly for other crypto coins Litecoin, Ethereum and others the same thing applies, for the investors instead of selling away the currency, opted to buy more, taking full advantage of the plunge.
And this only, in the end, resulted to benefit them, since the cryptocurrencies regained their former glory and value within 24 hours of the nasty plunge.
Volatile, is the perfect word for the values of Bitcoin and all other cryptocurrencies. But the long time investors, by now should know hat even after the great plunges the currency tends to recover no matter what. A for thenewbies, the current dip might come as heart attack, yet this was not really unexpected.
The value of these cryptocurrencies is in the blockchain tech and the fact that it is anti-inflationary and beyond the control of banks and governments. Expect some pretty vigorous reaction from those institutions as they begin to see Bitcoin and others start to reach the level where it impacts on their control. I imagine they will try and shut down exchanges and the flow of funds from fiat currencies to buy Bitcoin, Litecoin etc.
But then again, only time would tell the inevitable future and what it holds for the crypto world.