Well, it dipped below 100 momentarily.
Fundamentally, I don't see why the price should go down too much. I would think that as Difficulty increases, the value of a BTC would also increase because the cost of mining new coins has increased (cost in terms of hardware anyway).
I think it is actually other way around now. Dynamic price increases made mining so profitable that miners could just hoard most mined bitcoins. Now profit margin are much thinner and miners will need to sell most of mined bitcoins and that means more than 3000 new bitcoin landing on market every day. Funny thing is that falling prices self-reinforces this effect.Fundamentally, I don't see why the price should go down too much. I would think that as Difficulty increases, the value of a BTC would also increase because the cost of mining new coins has increased (cost in terms of hardware anyway).
That is actually a good point. Perhaps as difficulty increases and profit margins are thinner a larger portion of mined coins will go into actual circulation which lower price. I think that will take more time to happen though. Don't think we can attribute this price drop to that kind of behavior.
Also, in general the volume of bitcoin/fiat transactions is low -- too low to have a stable exchange rate. There are 11 million btc existing and as long as the 24-hour btc/fiat volume is so low (usually much less than 1% of that), volatility is going to be a problem. It does not take much to manipulate and move the exchange rate.
