Bitcoin goes into Free Fall as cryptocurrency price plummets in just 24 hours
Bitcoin has seen a dramatic drop in value over the past day, falling from a high of $8824.17 per bitcoin on Tuesday to a low of $8292.10 shortly after midnight on Wednesday, representing a 6 per cent decrease.
The value of the cryptocurrency was fluctuating around $8700 (£6445.83) until 3pm yesterday, before going into free fall.
Wednesday’s opening value was $8474.24 (£6278.56), before reaching a high of $8492.31 (£6291.95), and a falling to a low of $8328.38 (£6170.50) before the drop continued into the early hours of Wednesday.
Bitcoin hit its highest value before Christmas when the token reached the monumental price of just under $20,000.
However the value of the cryptocurrency plummeted rapidly by more than $44bn (£30.9bn) in January, falling by more than 10 per cent to below $9000.
Economists warned of a bitcoin bubble after the value of the cryptocurrency soared by over 900 per cent last year.
The digital currency has faced criticism by banks and finance experts, with billionaire Bill Gates telling CNBC he would bet against the cryptocurrency if he could.
Mr Gates said: “As an asset class, you’re not producing anything and so you shouldn’t expect it to go up.
“It’s kind of a pure ‘greater fool theory’ type of investment.
“I agree I would short it if there was an easy way to do it.”
Bank of England Governor Mark Carney has also been highly critical of the cryptocurrency landscape.
However he assuaged fears prior to the G20 summit in Hamburg, stating that cryptocurrencies do not pose a risk to the financial stability of traditional currencies.
Yet despite Bitcoin’s recent plummeting value, BitMex CEO Arthur Hayes stated he was not worried.
The former Citigroup trader said his price prediction for bitcoin was “$50,000 by the end of the year”.
When asked by CNBC’s Melissa Lee if he was a “little wobbly about that position” when bitcoin price plunged in January, Mr Hayes responded: “No. It’s my job to make predictions – whether or not they are right or wrong – it doesn’t really matter to me.”
He added: “I’m a volatility trader at the end of the day. We make our money if it is volatile.
“If it goes up, if it goes down, if you have Bill Gates calling it a fraud or whatever it is – great. Short it. I don’t care.
“Or if you think it is going to be a million dollars in a few months, great, buy it. We just match trades.”
Cryptocurrencies such as Bitcoin are highly volatile and are subject to sudden extreme price changes.