With one monumentally bad weekend in the rearview mirror, Bitcoin and other cryptocurrencies are continuing to trend downwards. Bitcoin has taken another dive, falling below $27,000.
Between Wednesday and Thursday morning, Bitcoin's value dropped by 10.68%; in the last week, it fell 28.07%; in the last month, it dropped 30.50%; and in the last year, its value plunged by 43.27%.
Bitcoin isn’t on the sliding board by itself. The value of Ether, the second-most traded digital currency, fell to as low as $1,700 – marking the first time the coin has been sub-$2,000 since last July. Others in the crypto Top 10 also dropped, including Ripple (XRP) (-23.48%) and Binance (BNB) (-10.9%). Interestingly enough, the U.S. dollar held its own and is actually up 0.51%.
What this means for investors
ConsumerAffairs asked Nick Donarski, the founder and CTO of Ore System, what Bitcoin's drop means for consumers. He suggested that lower values could be an opportunity for some investors, but there is danger as well.
“The crypto and bitcoin dip will only prove to give others an opportunity to get in at lower prices. The crypto markets have always shown that they return higher than where they dipped,” he suggested. “For now though, all those unrealized gains by crypto buyers, people using them as 'assets' for purchasing outside their means, will be real-world consequences.”
Donarski reminds cautious investors that there have been a number of “Great Halfenings” that have occurred throughout the fiscal life of crypto tokens. “I remember when bitcoin dove to $5 a coin from $32. I don’t know what the bottom is, but the return is certain to be higher,” he said.
Jeff Freiberger -- the CEO and founder of Media Coin, LLC -- believes Bitcoin and Ether are here to stay because of their globally-accepted infrastructure. However, other cryptocurrencies may not be as safe.
“All the others have a lot to worry about. You probably are going to see a lot of them close up shop," Freiberger told ConsumerAffairs.
How far can this decline go? Freiberger says it’s possible that Bitcoin and Ether may bottom out at zero value, but their ability to rebound is strong.
"The fact that these two are the most adopted and they have an infrastructure of miners worldwide says that this will build again,” he said, adding that “This time I see it being regulated so this can’t happen again. The fact that the USD Coin is minted on Ethereum should give everyone an idea of where this is headed," he said.
"Eventually the money will flow back in like the tides on an ocean. We're just seeing the low tide at the moment exposing all the junk that needs to be cleaned out."