Bitcoin bulls backed the price of the shaky asset on Tuesday, predicting that its price would continue to crawl back up after a slump earlier this week.
Bitcoin Back at $8,000
The controversial cryptocurrency took another tumble on Tuesday, falling below $6,000 — its lowest price since a surge in November last year.
The dramatic drop came amid broader investor unease amid the biggest plunge in the US stock markets in more than six years. At one point on Monday, the Dow Jones shed more than 800 points in 10 minutes.
But by Thursday afternoon in London bitcoin had made a partial recovery, valued at more than $8,000.
Crypto Market Could Hit $1 trillion this year; Bitcoin $50,000
“We believe after February the market will likely go on a bull run comparative if not greater than last year, potentially reaching the trillion-dollar mark, before a proper crypto winter sets in where the market becomes more focused on proper market fundamentals,” Jamie Burke, CEO at Outlier Ventures, a venture capital firm that focuses on blockchain investments, told CNBC.
Thomas Glucksmann, head of APAC business development at cryptocurrency exchange Gatecoin, added: “Increasing regulatory recognition of cryptocurrency exchanges, the entrance of institutional capital and major technology developments will contribute to the market’s rebound and push cryptocurrency prices to all new highs this year.
“There is no reason why we couldn’t see bitcoin pushing $50,000 by December.”
But many commentators claim that bitcoin has no fundamental value, though others see a value in digital tokens which can be used to build applications for blockchain, the rails upon which they run, with potential uses in clearing and settlements.
Bitcoin has collapsed from its high of more than $20,000 around Christmas following regulatory clampdown and credit card companies banning transactions involving the cryptocurrency.
Lloyds Banking Group and Virgin Money said they had imposed a ban on bitcoin, as well as Facebook which banned bitcoin adverts.
Bitcoin a “Very Risky” and “Entirely Speculative” Asset
Agustín Carstens, general manager of BIS, the bank for central banks, said on Tuesday that “if authorities do not act pre-emptively, cryptocurrencies could become more interconnected with the main financial system and become a threat to financial stability”.
His remarks came just a day after European Central Bank chief Mario Draghi said bitcoin was as a “very risky” and “entirely speculative” asset.
The recent $500 million theft of XEM coins by an anonymous hacker has also shaken investor faith in cryptocurrencies.
Take The Next Step with Alvexo Leave your details and we’ll reach out shortly.