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Bitcoin’s Sunset and Sunrise Within a Year. What Happens Now?

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  • Stavros Georgiadis
    📈 Price Predictions

    This November is different as BTC’s price has plummeted to the recent level of $3,800 from around $18,000 in January 2018, having lost about 78% of its value

Bitcoin’s Sunset and Sunrise Within a Year. What Happens Now?
Cover image via u.today

Disclaimer: The opinion expressed here is not investment advice – it is provided for informational purposes only. It does not necessarily reflect the opinion of U.Today. Every investment and all trading involves risk, so you should always perform your own research prior to making decisions. We do not recommend investing money you cannot afford to lose.

Contents

Bitcoin had an amazing price action in November of 2017, as its price went from $5,300 in early November of 2017 to almost $12,000 by end of November 2017, and one month later during December 2017, the price reached its all-time high around $20,000.

This November is different, though, as its price has plummeted to the recent level of $3,800 from around $18,000 in January 2018, having lost about 78% of its value. So, from sunset to sunrise, in this article we will analyze the main factors that caused this huge decline on a yield-to-date basis.

Bitcoin’s Monthly and Weekly Charts

Bitcoin’s Monthly and Weekly Charts

Bitcoin’s Monthly and Weekly Charts

Top Factors Influencing Bitcoin’s Price and Value

  1. There is not an easy way to calculate the intrinsic value.
  2. Taxation and regulatory challenges.
  3. Artificial, very large demand for energy, environmental issues.
  4. Economic effects and slow transactions.
  5. Long-term security concerns of its hashing algorithm and huge transaction fees.
  6. Security concerns against theft.
  7. Not an easy way for financial transactions to people who are technologically-savvy
  8. Requires knowledge about computer security
  9. It is slow and not very practical in daily retail transactions
  10. Lack of protection against fraudsters, scalability problems

What are the business prospects of Bitcoin now?

This collapse of Bitcoin’s price within one year reflects the change in the perception of investors, traders, and business acumen about the true prospects of the cryptocurrency. Its main competitive advantage includes being the first decentralized online digital currency and no need for a central bank. An alternative to traditional fiat currencies has failed to persuade the global investing and financial community so far, and this is solely based on its price reflecting the supply and demand levels.

The main concept that Bitcoin would be a revolution or an evolution in the global financial system has yet to materialize, and it is now very uncertain whether this scenario will ever occur.

Lack of regulation creates a very risky business and financial environment

The lack of regulation and very volatile trading price action makes Bitcoin not a suitable form of investment for many types of investors or investment funds. “Due to the lack of regulatory oversight, scams and market manipulation are commonplace.”

Legislators have a lot of work to do to avoid any fraudulent situations in the future, and due diligence in an extensive form is a requirement in the cryptocurrency market for a sophisticated investor.

What is the key problem for Bitcoin?

All the mentioned factors are very important for the future of Bitcoin. But the transition from its sunset to its most recent sunrise is due to one major factor, related to business and economic reasons: Its lack of broad acceptance and ease of use in daily business and retail transactions.

The elementary economic law that explains at first the price of any financial asset is the law of supply and demand. As of January 2018, and up to now, history has shown that there is excessive supply and no demand for Bitcoin. Technical analysis reflects this fundamental principle. For Bitcoin to move to significant price levels, this imbalance between supply and demand must change. Otherwise, any rallies will be vulnerable to speculative trends and profit taking.

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About the author

Stavros Georgiadis - CFA Charterholder, Economist, Forex market trader, US stock market financial analyst.

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Bitcoin Price Predicted to "Rocket Up." $7,400 Level Reclaimed by Bulls

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  • Alex Dovbnya
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    The Bitcoin price could soon touch $7,800 if bulls persist, but this move could be a short-lived one

Bitcoin Price Predicted to "Rocket Up." $7,400 Level Reclaimed by Bulls
Cover image via u.today

Popular crypto trader Wendy O recently predicted that the price of Bitcoin would "rocket up" if it managed to surge above the $7,400 level. 

Bitcoin Price
image by @CryptoWendyO

Shortly after that, the BTC price did rise above the aforementioned level, currently sitting at $7,444, according to CoinStats data

Bitcoin Price
image by coinstats.app

If the aforementioned forecast turns out to be accurate, Bitcoin traders could soon see another fakeout, which would be similar to the one that took place on Dec. 4. As reported by U.Today, BTC printed a massive green candle in less than a minute, but this unexpected pump quickly evaporated.     

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Earlier today, multiple traders predicted that Bitcoin was about to make a big move in either direction, but $7,800 seems to be the main area of interest for them. The leading cryptocurrency hasn't touch this level since Nov. 30. 

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with an extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets.

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