|28 May, 2017

Greed, panic surrounds Bitcoin traders

Last Thursday, Bitcoin reached $2,779, a record high, but dropped to a weekly low of $1,974 on Saturday

A Bitcoin (virtual currency) paper wallet with QR codes and coins are seen in an illustration picture taken at La Maison du Bitcoin in Paris July 11, 2014.

A Bitcoin (virtual currency) paper wallet with QR codes and coins are seen in an illustration picture taken at La Maison du Bitcoin in Paris July 11, 2014.

REUTERS/Benoit Tessier

Sunday, May 28, 2017

Dubai:

Bitcoin’s roller-coaster ride continued on Sunday, with the cryptocurrency recovering 7.2 per cent to trade at $2,293. It had fallen 28 per cent over the weekend.

Last Thursday, Bitcoin reached $2,779, a record high, but dropped to a weekly low of $1,974 on Saturday, according to Coindesk data. Many had been predicting that Bitcoin would breach the $3,000 mark.

“What goes up fast also goes down fast. That’s all. No outside forces. Just human greed followed by panic,” Andreas M. Antonopoulos, bitcoin and information security expert said on Twitter.

The cryptocurrency has seen volatile price swings since December, driven mainly by investors looking for alternative safe havens and wider acceptance in commercial markets.

Professional trading:

“Bitcoin trading is not for the faint-hearted. Only a professional traders who trades on strict trading strategies with exact stop losses and all can gain in Bitcoin trading,” said a technical analyst.

This is not for the first time that Bitcoin has witnessed one-way non stop rally. There have been two instances one in April 2013, and the second one in December 2013, when Bitcoin gained 1,800 per cent, but only to see a fall of 65-80 per cent.

According to the technical analyst, in the short-term, Bitcoin could fall to $1,600, with massive volatility.

“As an asset class, Bitcoin and other crypto-currencies are volatile. They can be used to inject some excitement in a well balanced portfolio, but only as a small part of a well diversified set of investments. It is not very wise to invest heavily in a single investment with high volatility,” Antonopoulos told Gulf News on May 22.

One should take a long-term view on bitcoins.

“My long term outlook remains very positive, because I think this is truly revolutionary and disruptive technology. On the way there, however, I expect a lot of ups and downs. It takes a very long term view (10 plus years) to be comfortable in this space,” Antonopoulos said.

Other cryptocurrencies also witnessed profit-taking like Bitcoin. Ethereum was 3.28 per cent lower at $154.58.

The cryptocurrency had hit a peak of $217 on May 25. Most analyst feel money would start pouring in Ethereum as it is considered as cheaper option to Bitcoin.

By Siddesh Suresh Mayenkar Senior Reporter

Gulf News 2017. All rights reserved.

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