Bitcoin just crossed the $16000 ceiling once again after depreciating for like a week. Being one of the largest virtual currencies, Bitcoin managed to regain its position in the financial instrument’s market after hitting the lowest ebb of $13000 mark which became the lowest point on its value table since 2013. There is no doubt that these virtual currencies are volatile and impossible to forecast but the proponents of this commodity feel that virtual currencies are the future of financial markets and the global economic system. There are definitely questions being raised against its legal legitimacy and regulatory controls associated with virtual currencies.
Today, the prices appreciated by 16% and led the Bitcoin to cross the slab of $16000, regaining its strength after the debacle last week. There is definitely a correlation between all the virtual currencies and their platforms because the different products appreciate and depreciate with a similar pattern. With the augmentation of Bitcoin’s worth, other virtual currencies like litecoin and ethereum also rose by 4.4% and 2.6%.
The gains proved to be a sigh of relief for worldwide investors who had bought the Bitcoins and other cryptocurrencies at inflated prices due to high demand and limited availability of the commodities on Coinbase or any other trading platform. Last week, the fall in the value of Bitcoin by almost 25% was a chaotic news because investors thought the bubble of virtual currencies would eventually explode and certain option and future firms even closed their counters in fear that the market might crash but the regain today is a sign that virtual currencies have a much significant role to play than just being speculative commodities like stocks.
The future of Bitcoin is not possible to predict because of lack of clarity about its operations and asset base. There are definitely positive signs related to it due to the appreciation in its worth by 1500% in 2017 which is phenomenal and daunting. The Bulls emphasize that virtual currency and blockchain technology holds more than just price appreciations and depreciation for the world, they might become the means of exchange in the future. On another hand, the Bears believe that the lack of intrinsic value attached to these virtual currencies will eventually become the reason for its decline and end. The unpredictability and fickleness in its price is an evident sign that virtual currencies are the seeds of disasters like the collateralized debt obligations were for the 2008’s financial crisis that struck the entire world.
There is no doubt about the fact that the market is polarized between extremes but it is very early to predict anything regarding the future of Bitcoin and other virtual currencies because a bad week or a sharp temporary spike in prices is not an indicator of anything.