Bitcoin prices plunged as February 2018 began, even breaking below the $6,000 benchmark at one point earlier this week. Many investors watched with horror and wondered if the bubble in cryptos, and Bitcoin in particular—which had a spectacular 2017, gaining more than 900% during the course of the year, hitting an all-time high of $19,783 in mid-December before losing more than 60 % of its value at current prices—was finally over.
But nosebleed highs and breathtaking lows appear to be a key part of this extremely volatile cryptocurrency’s history. Since the first Bitcoins were issued in 2009 the currency has experienced a number of corrections as well as two significant crashes—one in 2011, when it lost 94% of its value over a 5-month period, and in a more prolonged downturn from November 2013 through mid-January 2015 when it fell hard, dropping 85% in total.
Note that many analysts define a 60%-plus plunge as a bursting bubble. By that measure, Bitcoin has weathered two severe burst bubbles during it’s brief history, yet each time it’s come back stronger.
A number of factors appear to be in play. Asian governments have been making more noise about regulating ICOs and cryptocurrency trading for a while now.
Recent announcements from banks and credit card issuers noting they will no longer transact crypto purchases via credit cards have added to concerns pushing the alt-currency down further. JPMorgan Chase (NYSE:JPM), Bank of America (NYSE:BAC) and Citigroup (NYSE:C) have all said they’re halting purchases of Bitcoin and other cryptocurrencies on their credit cards. Read more from investing.com…
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