Why Bitcoin Will Climb AGAIN In 2018
The Bitcoin price crash of early 2018 can be attributed in a large part to the behaviour of dominant crypto exchange Mt Gox, argues Coin Telegraph’s William Suberg. The leading digital currency dipped to below $6,000 after reaching the heady heights of a $19,300 surge back in late 2017, causing panic among investors and leading to an asset sell-off which has made it hard for the digital coin’s price to recover.
Mt Gox is said to have engaged in a wholesale sell-off of its Bitcoin assets in late 2017 and early 2018, as it set out to pay off creditors – and to settle lawsuits relating to a 850,000 BTC loss from hackers back in 2014. The exchange has been dogged by allegations of fraud, and these may have prompted a trustee of the company to panic-sell a huge portion of the exchange’s Bitcoin reserves. Evidence suggests each sale pushed the Bitcoin price further down, until the cryptocurrency had lost more than half of its value per unit.
Of course, this is not the sole reason that Bitcoin ran into trouble during early 2018 – but it does explain the price crash to some extent. Now that Mt Gox is completing its sell-off and retreating from the market, we are starting to see the price of Bitcoin stabilising once more, and seeing investor confidence in the cryptocurrency returning.
It is also possible that insider trading took place during this time. A tip-off from Mt Gox on the upcoming sell-off, and resulting low prices, could have prompted a flurry of low-price purchases by investors who have already made gains on their new assets. In the meantime, buyers who purchased in good faith have had to ride out the price drop and see the value of their investment tank. Only now are the rates starting to improve.
Now that the issue is on the way to resolution, and now that authorities are becoming more welcoming of Bitcoin transactions, confidence in the currency is expected to grow. When trust can be rebuilt in Bitcoin and when crooked exchanges are held to account, Bitcoin has huge potential as a real-world currency and as a digital asset. Though the Bitcoin bubble did burst earlier this year, the currency is already starting to see growth again and it has real potential to stabilise and surge once more in 2018.
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