The price of Bitcoin has always been very volatile and while 2017 and the beginning of 2018 had extremely positive results, the rest of 2018 saw the price go down by over 80%. What happened to Bitcoin, why did Bitcoin go down, and will Bitcoin go back up? This article will analyze some of the factors that affect the market and take on abjective look at where the market may be headed and what are some of the best options out there.
The Bitcoin USD price has certainly taken a hit this year with Bitcoin going from USD 20,000 to averaging around USD 6,500 in September. In mid November the price then further plummeted and is trading at around USD 3,400 as of press time.
Below is a price chart of BTCUSD from November 15 to December 13, a sudden price drop is visible on the left part of the chart before smoothing out to a gentler downtrend and nearing a stabilization around USD 3,400.
With such numbers, it comes to no surprise that many start doubting whether or not investing in Bitcoin is a good choice, but is it really all bad?
The first thing to remember is that the price grew up by 1950% in just a few months in 2017; a clear sign of a bubble building up and a situation which could not continue for long. This was confirmed once the price approached the psychological barrier of USD 20,000, reversed, and turned bearish.
The last few months have also seen an increase in regulations, scrutiny, and restrictions for cryptocurrencies sparked by the controversial success of ICOs, the past security breaches, and rumors that some of the exchanges, lacking transparency, provided unfair advantages to their internal market making teams and traded against their clients.
These regulations and changes that happened in the cryptocurrency world clearly had an effect on the market but this is akin to weeding out of the bad herbs to prepare for a new, more fertile, playing field.
Q: Will Bitcoin crash today?
A: Retracements and reversals happen every day in traditional markets, and Bitcoin, novel and volatile as it is, is no exception. This, however, does not mean all hope is lost as this has happened before, an example being the price drop of 2014 following the MtGox scandal, but Bitcoin not only recovered every time but reached new heights.
Another thing to note is that, while other cryptocurrencies may rise and fall, Bitcoin is the poster child of cryptocurrencies as the first ever crypto, sees the most widespread adoption, and historically lead the market in both traded value and market cap all this leads to the conclusion that a complete crash of Bitcoin is very unlikely.
The coin benefits from a very supportive and enthusiastic community that made, and continue to make, it thrive. A recent concern is the fact that Bitcoin is becoming uneconomical to mine with its current proof-of-work concept something the community will undoubtedly need to fix but the previous creation of Bitcoin Cash proved that hard forks offer viable solutions to change the technology behind cryptocurrencies as long as enough people from the community support the move.
Q: Will Bitcoin rise again?
A: Opinions from experts may vary but most experts actively dabbling in cryptocurrencies do give positive prognostics on the price of Bitcoin. Now be mindful that those predictions look at long time periods and it is always advised to trade and take advantages over both bullish and bearish markets instead of applying a purely hodling strategy.
Q: What will happen to Bitcoin?
A: The cryptocurrency market, and Bitcoin in particular, is under increased scrutiny and will probably see further price corrections, on a smaller scale than previously observed, before stabilizing and being sufficiently appealing for traditional financial institutions to join in. Once that happens the market is likely to see a strong bullish move again; albeit not with the same strength as it did in 2017, but for a much longer period of time and with much less volatility
Q: What can I do with Bitcoin today?
A: While bear markets are certainly a gloomy period for those hodling onto their coins, it also represents an opportunity for those ready to day-trade. Many exchanges like Bybit now use cryptocurrency derivatives allowing traders to enter both long and short positions and profit from either bullish or bearish markets. In the current bear market, traders and cryptocurrency enthusiasts are those encouraged to register on such an exchange and enter profiting trades while waiting for the market to go bullish again.
Another opportunity now that the price is reaching an historical and technical support around USD 3,200 is to slowly accumulate coins in the hope of seeing a strong bullish market in the coming years.
This concludes today’s article about what happens if bitcoin crashes. This article was brought to you by Bybit, a cryptocurrency derivatives exchange aiming to create a fairer crypto market through transparency, speed, and bringing a more human touch to an otherwise cold and unregulated industry. We hope to see you back soon, and are happy to see you share our interest in the world of cryptocurrencies.