Bitcoin remains the largest cryptocurrency by market value, still ahead of the market, with a total value of approximately $137 billion; when the price of Bitcoin plummets, other cryptocurrencies are not immune. But why should the price of Bitcoin fall? Actually, there are many factors. This sharp decline began when Bitcoin prices began to soar last year. Even with the current price of just $8,400, Bitcoin’s price is up approximately 850% from this time last year. If you're an early investor, profit margins are still high.
Generally speaking, asset prices will not be lower than the market's assessment of fair prices, at least not lower than the market's assessment in the long term. Apple's stock price may briefly fall on the news, but if the company's revenue increases (as was the case last week), the stock price will still rise and a large-scale sell-off is unlikely to occur. However, if you are trying to determine a fair price for Bitcoin, you may be disappointed. The fundamentals of Bitcoin are indeed difficult to define. Significant developments either do not exist or are currently remote. Retailers have recently begun avoiding Bitcoin transactions, and most people who buy Bitcoin simply hold it rather than use it to pay.
Recently, there has been a lot of bad news about Bitcoin. For example, countries such as South Korea and India have introduced stricter regulations, China has completely banned Bitcoin trading, there are also a large number of cryptocurrency-related frauds, and countless high-profile investors have warned to be cautious about investing in Bitcoin. Predicting the price of Bitcoin and other cryptocurrencies can be dangerous. But at least for now, we can try to understand why the market reacts the way it does, and how changes can be made to stabilize it. Do we need to wait for new technologies like Lightning Network (for Bitcoin) and Proof-of-Stake (for Ethereum) to bring about a positive market reaction? Or can regulation bring stability? Or is it just a worthless bubble?
Charles Hayter, CEO of cryptocurrency comparison platform CryptoCompare, agrees. He believes that most recent regulatory measures are positive and effective and will bring "strict supervision and long-term stability". For example, there have been several recent bans, with many mainstream banks in the US and UK prohibiting customers from purchasing Bitcoin via credit card. Trevor Gerszt, chief executive of digital currency savings company CoinIRA, said in an email that the credit card ban is a bad thing and prevents buyers with lower credit from using cheap credit to influence the price of Bitcoin. ?