Traders and hodlers alike are back to biting their nails following a drop in Bitcoin prices after an upward trend took it past the 11,000 mark. One of the speculated reasons for it happening is potentially due to the ongoing sale of Mt. Gox.
The market has been in a strange position for the past few months locked into a bear cycle that has been extremely resistant to growth. There is a myriad of reasons that are being blamed, but many traders are doing their best to wait it out instead of selling at a loss.
This comes after billions flooded into bitcoin in the past week via some of the top holders stacking up their buy orders in anticipation of a potential bull run that has yet to come. From telegram to Reddit, crypto lovers speculate on when and if a reversal will come, with numbers and dates being thrown out to no avail.
Every prediction thus far has fell flat, and the FUD is very real.
There’s been a lot of speculation over when the current bear market is going to break. There have also been some theories about what caused it. Everything from blaming the Chinese new year to the overhyping of shoddy companies has harmed public confidence in Bitcoin and other cryptocurrencies.
It was thought that after-tax returns and the holidays in Asia ended, there would be a resurgence. The same was said after Wall Street men and women received their bonuses. Every date has come and gone, and things still have only gotten worse. Many cryptocurrencies are down at least 20% across the board within the past week and a half.
Though the beginning of the year has been the worst point every year since cryptocurrencies began, the sanctions and other legal action spells a potential trapping position. Without the freedom for investors to begin to pour back in and a lack of confidence, there is a possibility that market manipulation is inevitable, and not for the better.
It’s likely that the price of bitcoin will be driven down further. Since its been getting hard and harder to purchase without government interference, the average person attempting to get in will find it too difficult. The goal for the SEC is to “provide a safer trading environment,” when in actuality it appears to be they are attempting to reign in the madness and massive exchange of fiat that is happening.
How Low Can It Go?
There is no limit. Those who believe in bitcoin will continue to pour money in as others pull out. If regulations get worse and attempt only to let accredited investors or traders handle it, it will essentially defeat the purpose of bitcoin in the first place.
With every major country besides Japan, and many major companies ceasing to use bitcoin due to its slow processing times and high fees, its current use is only to act as a gold standard. Ripple isn’t a suitable replacement due to its centralized nature, which once again entirely defeats the purpose.
That only leaves a handful of options that aren’t at a stage where they can function as replacements to fiat.