Bitcoin’s Value Struggles For Stability
November 27, 2018 1:09 pm
After a vicious week for the cryptocurrency market, the value of bitcoin and other cryptocurrencies climbed up on Monday. According to Coindelite’s Price Chart, the costliest cryptocurrency in the world leveled up to $4,000 late Sunday.
The price of Bitcoin was as low as $3,447 on Sunday. However, later in the day, the extent of the damage was retrenched, raising the trading on Monday by 5.54 per cent to a price of $3,982. The undulant price of Bitcoin has been a cause of frustration among the investors. Its value has faced a serious downfall since its all-time high record close to $20,000 in December 2017, bringing the price to a drop of 80 per cent. XRP and ether, the second and third largest currencies respectively, both have dropped by 90 per cent since their high records.
The market was taken by storm on November 14, when the price of Bitcoin took a drastic plunge to $6,000. Tension had mounted around the so-called “hard forks” that resulted in Bitcoin split and the creation of Bitcoin cash.
Disagreement in a circle regarding the efficient scaling of cryptocurrency is the reason for the occurrence of such events. Efficient scaling of cryptocurrency is imperative to sustain a higher volume of trading. For example, Bitcoin’s blockchain, which has a tendency to become static during high demand, taking longer transaction time and rising fees.
The famous cryptocurrency is also linked with its hash rate, which measures the performance of the Bitcoin network. According to Charles Hayter, chief executive of digital currency comparison site CrytoCompare, “Bitcoin has been correlated to its hash rate and with it now falling, so is the price.”
“The idea is that the hash rate gives some idea of what underlying opex (operating expenses) and capital costs people are willing to utilize to generate bitcoin and give it a benchmark price.”
Judging by the frequent fluctuations in the prices of Bitcoin, the future of the most expensive cryptocurrency seems unpredictable.