Doomsayers would be quite pleased with themselves. ‘We told you so,’ would be an expected and yet annoying litany. Yes, Bitcoin’s price is at a disconcerting low, and some Wall Street wonks may be rather over-satisfied with themselves.
The realities here, however, are that Bitcoin is a currency, and currencies fluctuate. Whether it is the calm inching up and down the value ladder or the rather showy collapse of the whole economy, there is nothing surprising in Bitcoin’s slump.
A see-sow of ups and downs
Bitcoin first went down below the 8,000-threshold on Friday, when its value dipped to $7,695 – a rather chilling prospect, indeed! However, Bitcoin did not fail to alleviate fears by sallying back to $,9,472 on Saturday. And yet, it crashed anew.
Bitcoin is hardly alone, though. Ripple and Ethereum appear to have hit the doldrums as well, dropping 13% of their price within 24 hours.
India will not give up the gun
The rather tense legislative climate may explain the recent fall across the board of all cryptocurrencies.
Let us have a look back to Wednesday, when the Indian Minister of Finance Arun Jaitley joined the choir of people who cautioned that Bitcoin and other cryptocurrencies are being used to facilitate criminal activities.
Mr Jaitley vowed that India would eliminate all ‘illegitimate activities.’ And to be honest, Mr Jaitley is not the first person to express a dim view of cryptocurrencies.
A number of experts have pulled their weight to mount an assault on cryptocurrencies. The most notable detractor of Bitcoin and its brethren remains J.P. Morgan CEO Jamie Dimon who has not minced words. According to Mr Dimon, Bitcoin is a “fraud.”
Another Meccanite of the world of finances, Warren Buffet has also said openly that cryptocurrencies are headed for a collision course.
Accountability all around
The bashing of cryptocurrencies has continued. According to the New York Times, two prominent stock companies, namely Bitfinex and Tether have come under legal fire.
The news was later taken up by Bloomberg who have said that auditors were also looking into the dealings of the said exchanges.
The main obstacle with what Bitfinex is that the crypto company did not cover the worth of its cryptocurrencies in US dollars, making easy target for overly-concerned regulators.
Meanwhile, Bitcoin bubbles
Fears are that Bitcoin is a bubble, and perhaps the history’s biggest. If the recent trend continues, Bitcoin may die out by the end of the year, as Wall Street specialists envisage.
However, this is unlikely. Even if Bitcoin comes to an end, it would be in a gradual and rather elegant fashion as opposed to the numerous harsh downturns.
Meanwhile, a number of new cryptocurrencies have seen the light of day. The cryptocurrency world is at an interesting juncture.
In fact, crypto assets have been developed so much that even if a flagship one dies, a handful others will be on the ready to take its place.
Remember Dogecoin? A joke meme-based crypto asset that shined to glory, bolstered by worth of millions of dollars.
Looking ahead, Bitcoin may still have a bright future. The current churn is quite understandable as legislators are just now trying to hammer out a possible framework to regulate the vast sprawl of these assets.
We believe that when there are clearer regulations, cryptocurrencies are bound to maintain their net worth and not be as volatile as presently.
Of course this may spell the demise of some and lead to new cryptocurrencies that are better-adapted to deal with the new world – demanding as it is.
We will follow through with the latest regulatory patchwork and keep you posted.