Bitcoin Volatility: A Brief Summary

In December 2017 Bitcoin hit an all-time high at about $ 19.850 and then rapidly hit $12.000 in just a few days.

It seems that many of the traders got terrified of the downfall trend in the value of Bitcoin and also because of the bad news we received from Korea and India. Another thing that happened is the announcement from major US banks. They said that they wouldn’t support any crypto purchase. Banks that support these decisions are one of the biggest financial institutions such as JPMorgan Chase and Bank of America. These financial institutions don’t want anything to do with Bitcoin purchases with credit cards, and also don’t want to get involved with the risk of crypto trading.

One bigger issue occurred when China decided on even harsher regulations in their country. They want to go on with full access ban to all exchange platforms whether they are international or domestic. Also, all of their major social media networks banned all ads regarding cryptocurrencies just like Facebook did.

Another problem is the connection that Tether has with the US dollar. One Tether token is equal to one dollar. But many investors believe that Tether doesn’t have the reserves to back up its huge market cap. Tether hasn’t really been very transparent and many allegations were claimed against it. But if those allegations are true, we can, unfortunately, face another big plunge in the price of Bitcoin.

The currency is very volatile and it is inevitable to see price movements like this. Despite the fact that the governments will not allow the cryptocurrencies to develop without their intervention, maybe a little regulation is desirable in this market. Crashes on the market will keep on coming but they are, of course, not predictable. Recoveries, however, are highly likely to happen as well.