Bitcoin prices drops by 17%

January 5, 2021

Sayan Mitra
32

Previous reports

The year 2020 was a fantastic year for cryptocurrency. There was a significant rise in the price of bitcoin in 2020. There was a lot of debate and news related to this. This attracted many investors to bitcoin. Bitcoin saw its highest recently. The virtual currency was worth more than $33,000. Many investors are putting more money into bitcoin. This is due to its increasing value since 2017.

However, recent reports are quite shocking related to bitcoin.

Prices drop

Bitcoin’s value saw a significant fall on Monday. After a remarkable new year surge in prices, this is beyond expectation. Bitcoin is always known for its highly volatile nature. Prices fell down by 17%. This is the highest drop the cryptocurrency saw since March last year. The losses are majorly small as the nature of Bitcoin is most volatile. Above all, the cryptocurrency experienced a 50% hike in its value only in December 2020. The digital currency had a superb start in the new year. It touched $34,000 USD on Saturday. It was an all-time high for digital currency.

Expert’s opinion

Adrian Lowcock is the head of personal investing in Willis Owen Ltd. He mentioned that this drop in the price of bitcoin is a reminder for everyone. Tough it is prevalent in the market for a decade, but it is still a relatively new asset. This new-age currency is yet to make its mark in the investment market. He also added that Bitcoin has to cross major hurdles to becoming a useful mainstream asset.

Louis Gave is the co-founder of Gavekal Research. He said that the fluctuations in the price of Bitcoin are more interesting than many things. He added that Nasdaq stocks, Chinese internet plays are dull in comparison to this.

Probable causes

It is very difficult to figure out the possible causes in this world of cryptocurrency. The value of cryptocurrency fluctuated generally due to its volatile nature. The price of Bitcoin surged higher than 300 percent last year. Many companies and investors started opting for Bitcoin as a valuable asset. It saw a lot of investment from retail and financial corporations over the past year. Many eminent personalities spoke in favor of Bitcoin. Also, many people believed that cryptocurrencies are the future of investment. Many companies were trying to expand their growth to popularize the cryptocurrency. Bitcoin was emerging as a mainstream asset.

Some people blamed the market’s supply constraints. Some said the money printing by central banks’ is an important factor. Others pointed out that cryptocurrency is yet to make a mark in the market. The indecisive risk-taking factor could also be one of the possible reasons.

Paul Hickey also gave his views. He is the co-founder of Bespoke Investment Group. He pointed out that the link between the rise and fall of Bitcoin with the value of the dollar in the market. In addition, he said that the surge in the price of Bitcoin could be due to weaker dollar value. He mentioned that the last time dollar prices declined was in 2017. It was the same time when Bitcoin surged exponentially and got into mainstream.

Sayan Mitra
Sayan Mitra

Sayan is a writer by choice or rather by instincts. He had started as a content writer for an infrastructure development website. Over the years, he has been involved in several versatile projects, ranging from blogging to creative writing, penning down web content to site reviews. Tourism, fashion, real estate, gambling, sports, politics, business proposals, presentation work, technical writing, generalized topics – Sayan has done it all, with his words.

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