The value of bitcoin has been questionable for some time – but now, in light of the cryptocurrency’s performance in 2018, the uncertainty seems to be solidifying. Bitcoin prices have been declining gradually since the start of 2018, but towards the end of June, prices hit a new low that was not for some time and that established a dire outlook for the rest of the year. Even yesterday, CNBC's Fast Money hosted a Bitcoin Funeral going away party just to put out the vibe many cryptocurrency investors and enthusiasts are feeling with the year long lull..however you should read Bitcoin's Moment of Truth post if you are experiencing too much F.U.D. in the marketplace.
For the first time in a long time, BTC's price dropped below $6,000 USD to $5,938.17, which is the lowest price its been since November 2017. This decline is essentially a reduction in 57.2% of the currency’s value from the start of the year and it is quite different from the all-time high that the currency experienced in December 2017.
The high was $19,783.21 and anyone who notices this figure may find themselves questioning why the currency has declined so much and whether it will ever recover to the same heights.
Turning to the issue of what is causing the decline, there may not be a solid explanation. Several analysts had predicted the decline and it may just be a state of the market. According to Marius Rupsys, a digital currency investor, “The question is when big investors will come back.”
This statement shows that Rupsys suggests that the decline may be due to a lack of large investors, thereby causing one to wonder whether large-scale investors see a value in the currency any longer. Rupsys also stated,
“Retail traders might be actively buying and selling, but their volumes aren’t sufficient to move market significantly to either side. ‘Wait and see’ is for larger investors, who try to get in crypto assets using OTC.’”
Rupsys further stated, “The volume is going down consistently on all major exchanges (ie. Bitfiniex), so this sell pressure is reducing as less and less people willing to sell. I am waiting for volume to pick up, which is likely to push price upwards (given sellers sold and new investors want to get in). Though, it is very difficult to know when that happens, therefore my position is to wait for action with volume.”
There also is certainly another downside to the decline in Bitcoin’s value. The decline may suggest that the bear-like momentum may continue.
According to John Pearlstone,
“if Bitcoin breaks the 2018 lows, watch for a spike in volume and a possible fast drop in price towards the $5000 level.”
Another high-end figure in the Bitcoin world, Jeff Koyen, mentioned that he expects Bitcoin to further decline in value as sell-offs continue. The sell-offs suggest to other individuals that the value of Bitcoin is in a precarious situation and therefore, it may be better to get rid of the currency while it is at a relatively positive level.
Koyen predicts that bitcoin may reach as little as $5K before bargain hunters get involved in buying up the rest of the digital currency.
The best thing to do here on out is may be keep tracking the currency’s value in the coming months.