Crypto Recovery in Progress Despite Warnings: Bitcoin (BTC), Ripple (XRP), Ethreum (ETH), DASH

    The value of the bitcoin plummeted this Friday completing a difficult week for the cryptocurrency, which lost almost a third of its value after having reached a record price of almost US $20,000.

    According to the Coindesk exchange site, throughout the day the virtual currency was quoted at less than US $11,000, before experiencing a strong recovery that placed it slightly above US $15,000.

    In the midst of these fluctuations, three exchange houses that work with the currency suspended some transactions.

    The avalanche of exchanges caused by the collapse of this week ended up paralyzing one of the largest exchange exchanges of bitcoins, Coinbase, which suspended the purchase and sale of the cryptocurrency twice due to technical problems.

    And two other US exchanges, CME and CBOE, also temporarily suspended transactions on some futures contracts, which allow investors to bet on the expected bitcoin price at certain times.

    The bags have automatic brakes that activate when an asset or asset has moved in a certain amount, as happened in this case.

    “The law of gravity”

    The last 12 months have been extraordinarily good for bitcoin, which at the beginning of the year was priced at US $ 1,000.

    And until this week the value of the cryptocurrency had practically not stopped skyrocketing, more than doubling its value during the month of November attracting the interest of more and more investors.

    Crypto Comeback

    Since Saturday, Bitcoin (BTC) price along with other major crypto currencies like Ripple (XRP), DASH and Ethereum (ETH) is returning to levels seen prior to recent selloff.

    And according to some analysts, investors must prepare for such rapid changes, because this type of fluctuations have characterized this asset since its inception.

    “This is exactly how this asset is marketed and it has done so from the beginning,” Nick Colas, co-founder of DataTrek Research, based in New York, told the BBC. “It has a lot of volatility and will continue to have it in the future . ”

    As Jasper Lawler, research director at the London Capital Group, points out, that is a reality that could end up scare away the most novice investors.

    “In the last 24 hours investors in bitcoins simply discovered the law of gravity,” Lawler told the English newspaper The Guardian.

    “The old holders are probably used to this volatility, but it could end up scaring the new cryptoinvestmentists,” the analyst warned.

    “Correction” anticipated

    Indeed, according to Charles Hayer, founder and president of the specialized site Cryptocompare, the bitcoin market continues to operate emotionally.

    “A brutal rise, pushed by the pack, is followed by a fall caused by changes in emotional sentiment, and many investors were waiting for this correction,” Hayer explained.

    In fact, according to the analyst, this change was probably linked to the decision of some investors not to risk the spectacular gains obtained throughout the year.

    “The exponential price rise we had been seeing needed new investors to sustain themselves in. In a financial bubble it is what is known as ‘the most foolish theory ‘: you can buy expensive whenever there is a fool willing to buy a wreck yet higher “, is a possible reason identified by Lawler.

    And according to Nick Colas, a bitcoin broker, worries about the infrastructure that supports cryptocurrencies are also a possible cause.

    In recent weeks, markets have been shaken by hacks and accusations of insider trading.

    And regulators have also been more vocal in their warnings about the origin and risk of this type of virtual assets.

    One of the hardest comments came from Denmark, where the president of the Central Bank defined them as a “lethal bet”.

    Earlier this month, one of Britain’s leading financial regulators warned that people who invest in bitcoins should be ready “to lose all their money.”

    Andrew Bailey, the head of the Authority for Financial Conduct, told the BBC that neither central banks nor governments were behind the “currency”, so it was not a safe investment.

    But, despite the risks it represents for some individuals, US authorities have said they do not consider it a large enough part of financial markets to pose a threat to the economy.

    SHARE
    Previous articleIs This What Actually Happened To Cryptos Like Bitcoin (BTC) And Ripple (XRP)?
    Next articleIt’s No Joke: Massive Ripple (XRP) Gains Deserve Respect