Last year, Bitcoin had lost over 60% of its value. In the first days of 2015, the digital currency jumped another 30% and that covered a rebound of 30% on Thursday.
Bitcoin’s price shortly dropped below $200 on Wednesday which is a significant mental hindrance before recovering.
For some people, according to Bitcoin news site Coindesk, it is not lucrative for transactions to process. And Bitcoins to mine when the price drops lower than $200. The complicated math puzzles that the computer networks solve in place for new Bitcoins calls “Mining”.
Bitcoin was a bubble that has burst. Jeffrey Gundlach, head of powerful investment firm DoubleLine, is strongly in the Bitcoin bear camp. He even professed in a webcast on Tuesday that Bitcoin is going down to the dumping ground of digital currencies.
Bitcoin, to some supporters, seems to be a good investment – and this is a problem.
The price fluctuates drastically over the past few years and this disproves the fans’ belief that Bitcoin is a great investment.
Some of the Bitcoin believers claimed that the fact that sovereign nations do not print Bitcoins is an advantage that should increase its value. An algorithm can establish a limited supply of Bitcoins.
Although, that does not validate why the price should reach an unsurpassed rise over $1,100 back in November 2013.
The Bitcoin price explosion was a classic speculative mania, just like Internet stocks in the late 1990s and housing in the mid-2000s.
When individuals believe that the price of something should keep rising, they assume that the asset dooms to failure.
But Bitcoin is not dead. Matters have finally calmed down on Bitcoin. And because of that reason, it may be a mistake to assume that it is on its way to uselessness.
That statement came from a well-known venture capitalist, Marc Andreessen, who has an investment in Bitcoin wallet startup Coinbase.
He emphasized that Bitcoin is an ecosystem that is a payment method. The argument as if Bitcoin is something investors should exchange does not make any sense.
Some of his striking statements are. First, Bitcoin being attacked for having risky levels of unpredictability does not prove its point as to how the system was originally designed for its purpose. Second, he considers Bitcoin as effectively useful as a transaction and trust network even in times of instability.
Andreessen has a point and why else would a lot of big companies like Microsoft (MSFT), Dell, and online retailer Overstock (OSTK) accept Bitcoins as a payment.
Bitcoin died seemingly 32 times but it is wrong to affirm the end of Bitcoin. As there is a dedicated website to Bitcoin obituary stories that prove all wrong.
