ByBit
0
📈 Price Predictions
106 views

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

  • 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.

Subscribe to the official U.Today Telegram channel. Get news first!

About the author

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

TOP TRADING BOTSPromoted
Recommended articles
CLOUD MININGPromoted
0
📰 News
654 views

Bitcoin's Parabolic Uptrend Remains Intact Despite Price Collapse: Tuur Demeester

  • Alex Dovbnya
    📰 News

    Tuur Demeester wants you to buy the dip as Bitcoin touches the support of its parabolic uptrend for the first time since March

Bitcoin's Parabolic Uptrend Remains Intact Despite Price Collapse: Tuur Demeester
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.

Tuur Demeester of Adamant Capital has just taken to Twitter to calm down Bitcoin enthusiasts who might have been swayed by incredibly bearish sentiment on crypto Twitter. 

👉MUST READ

Bitcoin Price Slashed to $6K. Is This Best Black Friday Sale?

Bitcoin Price Slashed to $6K. Is This Best Black Friday Sale?

Bitcoin recently dropped to $6,800, its lowest level since early May. However, Demeester apparently sees this as yet another opportunity to buy the dip. He states that top coin's parabolic uptrend that started at the beginning of 2015 hasn't been violated. However, Bitcoin has tapped support for the first time since March when Bitcoin was trading well below $4,000. 

Shortly after printing a huge red candle on the logarithmic chart, the Bitcoin price spiked by 20 percent on Apr. 2, which started the coin's massive run to $13,700. 

👉MUST READ

Crypto Analyst Doesn't Expect Bitcoin Price to Repeat Past Halvenings

Crypto Analyst Doesn't Expect Bitcoin Price to Repeat Past Halvenings

As of now, BTC is down by nearly 50 percent from its yearly high, but this might not be the end of the nightmare for Bitcoin bulls. According to trading exert Josh Rager, the crypto king could plunge below the $7,000 level again after a fakeout to the $7,500 range. 

Gold bug Peter Schiff recently predicted that BTC could collapse to $10,000 level after competing the head-and-shoulders pattern.  

At the time of writing, BTC is sitting $7,313, CoinStats data shows. 

Subscribe to U.Today on Twitter and get involved in all top daily crypto news, stories and price predictions!

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.

TOP TRADING BOTSPromoted
Recommended articles
CLOUD MININGPromoted