So, it happened. After some time moving in a narrow range in the low $300s, Bitcoin price has plunged below $300. This new Bitcoin price crash at the beginning of 2015 is is a continuation of the downward trend of last year - in 2014,…
The year-end status of Bitcoin Price is very bad news for speculators, especially for those who purchased their bitcoins one year ago when the price was above $1000, hoping to sell at a profit soon, and have seen Bitcoin price steadily going down instead.
Waiting for a more sophisticated analysis to be published soon, I wish to say once again that Bitcoin price is not important.
In 2014, Bitcoin was a very bad investment for speculators, but a very good investment for venture capitalists. They invest in cryptocurrency startups because they see that the volume of Bitcoin transactions and the adoption of Bitcoin by consumers and merchants are rising.
As CCN observed in September, use drives down price. If everyone wants to buy and nobody wants to sell, the price skyrockets. If more people want to sell, the price goes down. This basic principle of economy applies to everything, including Bitcoin.
Today we have a critical mass of people who use their bitcoins to buy goods and services. We pay merchants in Bitcoin, and sometimes they use bitcoins to pay their suppliers, but at some point in the chain somebody will convert the bitcoins to fiat currency, and that will pull the value of Bitcoin down.
Also read: Will Bitcoin Price Continue To Go Down?
At the same time, Bitcoin is well on its way to revolutionize finance with disruptive killer apps. Venture capitalists understand that, and some of their investments will pay off handsomely.
CCN hosts an interactive Bitcoin price chart and market metrics.
Readers can follow Bitcoin price analysis updates every day on CCN.
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Last modified: January 3, 2020 3:29 PM UTC