The trend on Bitcoin prices appears bearish with price on bitstamp, a popular bitcoin exchange quoting a price of $7600 per coin. In fact the current price is lower than analytical estimates posted by Coinigy.
By 5:33 PM Indian Standard Time, bitcoin had achieved its lowst price on Coindesk of $7561.21. The price is the lowest recorded so far for 2018.
Coinigy as well as handful of other analysts had quoted a range of $7704.12 as a range that bitcoins might have held onto. But the slump has been more of a free-fall, bringing down bitcoin valuations as well as it's market cap.
There is no consensus currently on what is resulting in this massive sell-off. But the sell-off apparently has dusted bitcoin valuations to the ground.
According to data from Coinmarketcap, bitcoin was trading down 11.35% on Tuesday, which has brought down market valuations to $132.49 billion. A month ago, the start of January, bitcoin was trading at an astronomical price of nearly $20,000 per coin, with a market cap of $835 billion.
To give you perspective, Amazon today has a market capitalisation of $692.10 billion (the stock is up by 2.87% or nearly 40 points on Nasdaq), Microsoft's current market cap is $706.69 billion. To give you an Indian perspective, Mukesh Ambani's Reliance Industries has a market cap of $51 billion.
The loss in valuation is extreme and an unimaginable $703 billion, nearly the size of 1 Microsoft, or just over 13 Reliance Industries put together.
Bitcoin's loss however seems to be the gain for many newer entrants to the system, who are swarming claiming it to be an opportune moment to get to a system that promises a lucrative return. This sounds realistic at least for the many Indian investors. Stories of bitcoin millionaires have been many in India, but the price around the last week of December was too steep. The time however is bad for those who entered the bitcoin system when it was a high, with prices running upto Rs 13-14 lakhs on Dec 28th.
Many readers on Reddit and popular public forums on Telegram were dreaming of 140x-200x times margin improvement, and ridiculed folks who were contemplating of selling their earnings. "Do not chicken-out........... HODL!!!!!!!!" read a forum of a 200 member strong community on Telegram.
Reasons for the slump have been varied, but here are a handful ones:
- Higher interest in dollar Bonds is being considered as a safe haven, and hence money is trickling away from bitcoins.
- Fear, Uncertainty & Doubt, codenamed into an acronym FUD. FUD has swarmed investors across the globe. The most recent example of FUDs is the media misinterpretation of Finance Minister Arun Jaitley's comment, which resulted into an immediate 10% decline in valuations.
- Another official comment from a law-maker from India. This time its the Department of Economic Affairs. Read it here.
Sadly, every word of advice, be it a tweet, or a reddit post, even a telegram message, at the moment reads more like a prayer, than logical assessment, considering that there isn't much logics that can be used to evaluate bitcoin price. For the ones wanting some quick logics, here is some:
- Bitcoin Price during the last day on January 2018 was $10,033.90. In January 2017 the price was $921.17.
- Price on the close of trading on 28th February 2017 was $1190.89
- Other cryptocurrencies are also facing a whiplash. Ethereum is trading in the negative by 13.31%, Ripple by 14.41%, Cardano by 18.61%, and Bitcoin Cash by 14.89%.
The next logical resistance, according to a popular reddit post has developed around $5600. Want to HODL?
Here are some tweets:
We are into a super bear #crypto market.. 280B is the next downside .. every rise is a sell now for traders. For investors #HODL #Bitcoin #ripple #xrp #Coinmarketcap #Neo @Altcoinbuzzio @coinbase @coindesk @CoinMarketCap @Cointelegraph @rimbitwhale pic.twitter.com/m6OPk1qLyl
— rupesh jaiswal (@rupzswee2) February 5, 2018
If #HODLing of #bitcoin looks crazy to you then consider that selloff is suicidal. I'd rather be f*ckin crazy than dead. #HODL
— ELEKTRONIC (@3L3KTRONIC) February 5, 2018
