Bitcoin prices continue their dive, now below $300


The beginning of October may well have heralded an upturn in fortunes for many FX companies as trading during September has concluded with the widespread revelation that volumes are increasing dramatically for the first time since last summer.

As October began and the exponentially increased electronic trading volumes began to be unveiled by many firms, Bitcoin values were down to less than $400 for the first time since the last quarter of 2013 due to a strengthening dollar which resulted in less interest in Bitcoin.

Ten days on, this dynamic has continued, with Bitcoin values down to $300 to 1 Bitcoin, at a time when Bitcoin technology has made tremendous steps toward attracting mainstream corporate attention this year, with venture capital backing from seasoned firms, as well as regulatory approval in New York State and Switzerland.

 

All-Time Chart Courtesy: CoinBase
All-Time Chart Courtesy: CoinBase

 

Indeed, Bitcoin’s soaring values during the latter part of last year which resulted in values of over $1000 to 1 Bitcoin, during a period of uncertainty which blighted the mainstream financial sector as well as virtual currency.

During the period of the controversial bail-in which was imposed on customers of two Cypriot banks – Laiki Bank and the Bank of Cyprus last March, resulting in the two insolvent banks requiring their customers to pay up to 60% of their deposits to the banks, Bitcoin values started to increase to what was at the time an unprecedented high of $241 to 1 Bitcoin.

That value began to rise and as the government authorities closed in on illicit activity conducted in virtual currencies such as that of the anonymous market place Silk Road, Bitcoin demand rocketed. In Argentina, the value of Bitcoin rose to 30% higher than that of nearby Uruguay as citizens began to view the virtual currency as a method of circumventing the country’s rapidly depreciating sovereign currency, draconian capital control laws and expensive dollar conversion rates for tourists.

As widespread accessibility to Bitcoin continues via extensive networks of ATM terminals and newly established regulated exchanges, Bitcoin values continue to dwindle.

This indeed begs the question as to whether Bitcoin values were so inflated last year due to its real position as a method of payment which operates completely outside of the realms of governments, banks, regulatory authorities, and standard procedure which is subject to checks and balances, as well as speculatory investment from pioneers who were not put off by the downfall of MtGox. As the currency has become the focus of technological innovation, regulatory and government acceptance in Western countries as it gradually makes its way toward becoming another de facto method of payment, perhaps the appeal, as well as the risk, is now less than it had been during the boom in interest in virtual currency.

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Bitcoin prices continue their dive, now below $300

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