Bitcoin crash! The most highlighted event in the entire crypto currency market
2018 records the worst history of Bitcoin’s price. The year has witnessed half of the price loss of the most popular cryptocurrency. Some of the investors are apprehending that the latest crash of Bitcoin clearly signifies its end. It is better to take a step back. Let’s make an assessment about Bitcoin’s latest state. The past years have clearly visualized the growth of Bitcoin. Last week crypto market was completely on the back-foot. However, the cryptocurrency is putting to fight back so as to beat the resistance. Though a bit of price drop, the analysts are optimistic about the rebound of Bitcoin.
The question may arise in our mind why the price of Bitcoin is suffering a downfall? It has been claimed by some that the hack at Conrail, a South Korean exchange is causing fear among the investors. On the other hand, some are of the opinion that this fear was caused by the WSJ story, that was published on a saturday morning, regarding the CFTC demanding the bitcoin trading data from exchanges for investigating the claims of manipulation. But there was no data sharing agreement with any sort of exchanges. This completely made it impossible for Chicago trading venue to make certain the trade volume that occurred at the underlying crypto exchanges.
Irrespective of the actual cause, the sellers started panicking about selling bitcoin as the price started to decline. Weekend witnessed a lower amount of trading volume as the retail investors forms the dominant group. As per the CNBC report on an early afternoon last Saturday EST, there had been a sharp inclination of trading volumes by 25%. The steep increase caused the slide of Bitcoin price to a sharp decline.
Last week we found, the sudden decrease in the price of Bitcoin. Though Bitcoin has faced a steady growth, the point which remains to be considered is whether the upward move is sufficient for this popular virtual currency to break the barrier of $10,000 in the upcoming months? As per Mr. Godbole, the analyst in Coin-desk, Bitcoin will definitely test the hurdle of $9,000. The argument is completely based on the assumption and there is as such nothing to indicate, whether the Bitcoin traders are ready to cross the boundary. Bitcoin has however always undergone an experiment to something which has implemented in day to day life. Bitcoin continually remains highlighted in the headlines than other cryptocurrencies. But the chances to rise up above $10,000 still remains vague. There are innumerable reasons behind this. Cryptocurrency is an area where it is impossible to predict the price. But it will definitely affect the investors.
The price of Bitcoin went to $6k as records the earlier part of this year. It again went to $8K and struggled hard to rise up over $9K but faced a fall back to $6K level. It struggled at this level for quite a long time. As per our perspective, this leading currency fell to $6,108, which is its lowest level since February 6. The recovery which is $6,500 is not at all surprising. This indicates that bitcoin has temporarily stabilized to around $6,100. With the price falling to $6,108, RSI signaled to an optimistic divergence. At present, BTC is really seeing a hard time, thus locating at $6,857. BTC have temporarily lowered to $6,109. Its repeated failure of holding above $6,425 in spite of the optimistic divergence of RSI, has resulted in the drop down of price by $6,000.
The value of cryptocurrencies faced a continuous volatility when compared to other cryptocurrencies. As per the cryptocurrency market record in 2018 the Bitcoin price has faced a shedding of more than 50 percent. The volatility of Bitcoin has also brought an ill effect on the entire market of cryptocurrency. Bitcoin has become one of the popular and largest cryptos based on its market cap. The Bitcoin pairs commonly with Ethereum. Apart from that, there are number of other digital currencies. They are also known as altcoins. These altcoins are alternatives to bitcoin. These are also known as ether, ripple, cash, monero, and dash. How the price of Bitcoin affects other coins? Let’s take an example.
Jenney wishes to buy altcoin. She is unaware of any other cryptocurrency. So she must buy either Bitcoin, Ethereum, Litecoin or Ripple with Fiat. Jenny takes a decision to buy Bitcoin, as that is the only cryptocurrency about which she has heard. Bitcoins most common trading pairs are Ethereum. After five months she decides to sell the altcoin as she made some point. There is as such no easy way of selling the altcoins. So she decides to sell the altcoins for BTC and sell the BTC for Fiat. Now, this clearly shows how much altcoins are dependent on Bitcoin’s value. In case the value of Bitcoin fluctuates, what will happen to the altcoin? If the Bitcoin value gains and the Altcoin value remains the same, in this case, the Altcoin value has risen. In case she trades the altcoin in case of Bitcoin, they will have similar value as Bitcoin started with.
In case Bitcoin gains value, the ratio for exchange between the altcoin and bitcoin also goes down. If Bitcoin remains the same and the ratio between altcoin/BTC goes down then there is a chance that Jenny will receive the lesser amount of Bitcoin, in case she trades the altcoin back for the Bitcoin. There is another scenario when Bitcoin loses value and the altcoin/BTC comes down. If this is the case, then there is a chance of losing the higher amount of money on the investment. This is the worst scenario. In this case, there is not only a chance that Bitcoin will lose more value Jenny will also receive a lesser amount of money than he began with.
There are several factors that influences the price of Bitcoin. The first factor is the increase and decrease in its supply and demand. There are also a number of regulations which are enforced by the government on the transactions of Bitcoin. Then there is also some media influence that gives some positive and negative influence. The bitcoin users and developers are also crucial factors that influence the rise and fall of its price.
These contributing factors determining the value of Bitcoin, which are all variables, will collectively determine the fate of Bitcoin in the future. Whichever the price goes, BTC is going to stay in the market.
