Bitcoin continues to experience pressure after approaching the fifth month of a bearish moving average.
Bitcoin was trading at $ 7.881.40, falling 4.27% on Wednesday (04/23) on the Bitfinex exchange.
The five-month moving average of Bitcoin was at $ 8.916, and the 10-month moving average was at $ 8.379, well off the high of nearly $ 20,000 in December. A fall in prices usually indicates lower price movements in the long run, some analysts said.
Total market capitalization totaled $ 344 billion, down from $ 382 billion on Tuesday.
Other digital coins are also moving lower. Ethereum, the world's second largest cryptocurrency by market capitalization, shed 10.36% to $ 620.25 on Bitfinex exchange. Ripple, the third largest virtual currency, tumbled 8.60% to $ 0.61299 while Litecoin was at $ 124.26 with a 6.57% jump.
The instability of the digital asset market could be more about how investors view than other factors that typically impact fiat currencies, a research paper from the University of Warwick suggests.
Trading volumes are driven by past returns and market uncertainty, while confidence in blockchain and digital currency technology also impacts prices.
As per coinmarketcap website, the price of one bitcoin was $2443.64 on 24th May 2017, just an year back. So if I compare it with today's price, it is an increase of 209.29%. Name any other class of investment, which can fetch you a profit of 209% in a year. I doubt you will be able to name any single asset which can outperform bitcoin in returns.
The bitcoin market is highly dynamic which makes it a speculator's heaven. I would have worried if the blockchain technology, which is the core technology of bitcoin was considered as a junk technology. But blockchain is highly regarded worldwide for its capability and integrity. So I am not worried about this small decrease in price. Instead I am looking it as an opportunity to score more bitcoins for my cold storage.
Of course, bitcoin can surpass last year's high in 2018 as well. But since we don't know what future has in store for us, let us wait for that time and see for ourselves. It definitely has the potential but also depends on many other factors like legislative structures and adoption decisions. So wait and watch! But make sure to have enough bitcoins in your cold storage to get the benefits when it happens.