After smashing through various $1,000 marks on its way to topping $9,000 Bitcoin has finally slowed its run
As Bitcoin smashed through the $11,000, $12,000 and so on all the way to $19,000 on some exchanges, people were wondering if, when, and how this monster bull run would all come to an end.
It finally has ended for the digital currency as the price corrected from just under the $19,000 mark to sit at 14,470 at time of publishing. This represents a fall of around 14 percent, which in Bitcoin terms is relatively minor.
Hardly a crash, nor a bubble pop, as some pessimists might suggest, it is presumed that investors may simply be taking stock and cashing out a little after gains of over $5,000 per coin.
Reasons for the rise?
Most of the recent run-up came about because of the news out of CME that they would be operating Bitcoin futures come December. That news helped push Bitcoin past $7,000 in a little price boost.
However, as the Dec. 10 and 18 deadlines for CME and CBOE to launch their futures approach, there has been fresh vigor and frenzy. Essentially, it allows for traditional investors to add a new asset class to their portfolios and helps with the adoption of such a sector.
Of course, those who felt the full brunt of the rise will be sad that it is over, having profited incredibly well in little under a week. However, the price correction that this should be viewed as is probably a good thing ahead of the futures launch.
Many have seen Bitcoin rise to dizzying heights and then drop off steeply, citing bubbles and collapses and other such pessimism, however, it is natural for correction to take place – especially in such a speculative market.
Adam Sharp, the co-founder of Early Investing, said back in September when Bitcoin faced another big drop off after a great Bull run:
“It’s just natural and normal for a market to have a correction after a run like that. Historically, Bitcoin corrects anywhere from 30 percent to 50 percent. But the long-term trend is still strongly bullish. We’re up from $0.0033 in 2009 in the very early days to close to $4,000 today.”
With this latest bout of adoption and mainstream acceptance, many are feeling that even with a dramatic price drop, Bitcoin still won’t be heading to zero – a concern that was still a potential not too long ago.
Analysts from FxPro said of this latest correction:
“Bitcoin has proven to all that it’s able to overcome gravity. Its exponential rise in value, however, isn’t simply due to the impending arrival of institutional investors. Cryptocurrencies, and Bitcoin, in particular, have become extremely popular with the general public, and as prices move ever higher, the desire to invest continues to grow.”
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Author: Darryn Pollock