A coin representing Bitcoin cryptocurrency sits reflected on a polished surface and photographed against a backdrop image of molten gold pouring from a bucket in this arranged photograph in London, U.K., on Thursday, Feb. 8, 2018.
Cryptocurrencies tracked by Coinmarketcap.com have lost more than $500 billion of market value since early January as governments clamped down, credit-card issuers halted purchases and investors grew increasingly concerned that last year’s meteoric rise in digital assets was unjustified. Photographer: Luke MacGregor/Bloomberg While many crypto investors have coined Bitcoin as the world’s “digital gold,” others are growing uncertain of Bitcoin’s value.
Howard Wang of New York-based Convoy Investments LLC and Jeremy Grantham of GMO LLC have analyzed Bitcoin’s advance relative to past frenzies and concluded that it’s unsustainable, which was noted in a recent Bloomberg article. In a letter to investors sent out on January 3, Grantham summed up his concerns over Bitcoin saying, “Having no clear fundamental value and largely unregulated markets, coupled with a storyline conducive to delusions of grandeur, makes this more than anything we can find in the history books the very essence of a bubble.” However, it is still too soon to tell if the “Bitcoin bubble” will indeed burst.
What has become clear though, is that Bitcoin should not be considered a safe-haven asset. I say this as I examine a chart complied by the data visualization site HowMuch, which displays an illustrative table of all the “horrific Bitcoin crashes” that have occurred since 2012.
Looking at this chart, it appears that Bitcoin lost 83% of its value in just three days between April 10, 2013 to April 21, 2013. Bitcoin’s next biggest crash occurred just recently, losing 70% of its value from December 2017 to February 6, 2018. Read more from forbes.com…
thumbnail courtesy of forbes.com