Bitcoin has always been the leader of the cryptocurrency pack. Although not the first attempt at a digital currency, it was, however, the most successful.
At the start of 2017, 1BTC (Bitcoin) stood just shy of the $1,000USD mark. It had not seen much change in its value in the last year of 2016, but in 2017, it had a rocky yet meteoric run. It broke its own record value, only to plunge back- and then repeatedly do so, each time gaining value none of the best economists in the world could ever predict.
The cryptocurrency peaked at $19,343USD on 16 December 2017.
So, what happened and what drove its chaotic price jumps? Here’s our take on the wild ride from $900 to $20,000:
New Year, New Record
The value of Bitcoin was mostly stable in 2016, hovering in the higher band of $900.
The adoption of the cryptocurrency was proceeding at a fast pace. Yet, in the very first days of 2017, Bitcoin crossed the $1,000 barrier for the first time in its history.
Mass media coverage fueled the buying frenzy and only a few days later, the price stabled out at $800.
With the value again crossing the $1,000 mark, Japan’s recognition of Bitcoin as legal method of payment on 1st of April (bringing Bitcoin exchanges under the anti-money laundering, AML, and Know Your Customer, KYC, rules), fueled its second major growth.
After the announcement of this ruling, many Japanese rushed to convert their Yen into BTC and the subsequent buying spree resulted in the value jumping by 12 percent to $1,215.69.
The summer of 2017 saw the most ups and downs as the value crossed $2,000 in the ending days of May and then $3,000 in June.
The quick rise was always accompanied by a sharp drop in value. One of the most upsetting drops of the summer was $300 just hours after it crossed the $3,000 barrier.
Fork in the road
The slower operations of Bitcoin transfers and its possible remedies have been debated for years. In the start of August, the Bitcoin community effectively split in two, largely over these issues.
This fork created Bitcoin Cash (BCH). By and large, people were wary of the new currency and buying of BTC increased as Bitcoin Cash was sold to buy BTC instead, causing a near $600 hike and again crossing the $3,000 mark to close at $3,383.79
China is one of the biggest users of Bitcoin, so when the Chinese government introduced new regulations to crackdown on exchanges operating within the country, the value dropped from the then of all time high of $5,000 to less than $3,000 within ten days.
The regulations forced the three largest exchanges in China to suspend trading and close down. The mass scare caused the largest demographic users of the cryptocurrency to sell off their coins which upset the supply and demand balance.
In mid-October, as the Chinese noose tightened on the cryptocurrency while Japanese acceptance increased, the Yen started taking over the role that Yuan once held.
The liquidity quickly moved not only because of the easier legislation by the Japanese, but that in the tech savvy nation, the acceptance of Bitcoin as an everyday means of payment was hugely popular and that drove the demand up.
In November, the price was rising gradually, until it hit the $11,441 mark. A major holder of BTC had set his exit trigger at $11,400 and he unleashed a massive sell order that drove everyone into a panic and the price crashed by 12 percent in just four minutes.
With such big names jumping into the cryptocurrency, it fueled people to buy Bitcoin as this could mean the rise of value in a stable, long-term manner. The sudden high demand and people, who already had BTC and were hesitant to sell, upset the market and one the largest jumps of value was recorded, with one BTC valued at $19,343USD!
So, what does Bitcoin have in store for us in 2018?
The cryptocurrency is very unpredictable (as they all are) and, with more people now willing to buy it to invest and circumvent expensive fees offered by traditional banks to send money, one thing is all but certain: 2018 will see an unprecedented growth (hopefully) and volatility (likely) that will dwarf 2017’s.
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BTC Wallet: 1LyutLaQ3sufbFcETue6kYbQHqZvYbvAD9
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