Bitcoin’s price falls, but without serious trading consequences
The last few days bitcoin has been in a bit of a downturn.
On Monday, the price of Bitcoin dropped nearly 12 percent, to $435.60 from $492.95, according to the virtual currency website CoinDesk, its lowest value since May and far below its peak of about $1,150 last year.
Also on Monday, the price briefly plummeted to $309 on BTC-e, an exchange with shadowy backing, in what some in the industry called Bitcoin’s version of a “flash crash.
Yet, despite the latest one-day swing, Bitcoin’s price has been steadily falling in recent weeks, a trend that follows a period of relative stability since February when the Bitcoin exchange Mt. Gox collapsed.
It also is occurring as new regulations and a general stock market malaise have taken hold.
Last week, another regulatory agency, the federal Consumer Financial Protection Bureau, issued a warning on virtual currency, further igniting fear in the Bitcoin world over possible restrictions.
On any day, the currency’s price can fluctuate by more than 5 percent.
What makes the recent decline notable is the relative calm that preceded it.
Bitcoin is not the only alternative currency to decline in recent days. So-called altcoins — including Litecoin, which has the second-highest market capitalization behind Bitcoin — have fallen in value across the board, according to the website CoinMarketCap.
“It’s very hard to come up with a fundamental value for Bitcoin,” said Mr. Englander, the Citigroup analyst. “What really defines the price is its reputation and expectations for the future.”
Source: NYT
