Bitcoin Price Falls 40% In 3 Days Underlining Gold’s Safe Haven Credentials
By: Jan Skoyles
GoldSeek.com
Monday, 18 September 2017
– Bitcoin price action shows cryptos vulnerable to commentary and government policies
– Bitcoin falls to low of $2,980, down by $1,000 in week as China flexes muscles
– Volatility major issue: In 3 days btc fell 40% before bouncing 25% off lows
– BIS state risks of cryptos cannot yet be fully assessed and says technology still unproven
– Apple and Google developing a payment API for cryptos – may give governments full oversight
– Bitcoin and cryptos current volatility and exposure to governments underlines gold’s safe haven status
Courtesy of CoinDesk
Even for bitcoin last week was an eventful week. The price hit a recent low of $2,980, falling 40% and recovering by nearly 25% in the space of three days.
Last week was a good example of the vulnerabilities in the cryptocurrency space to government announcements regarding the infrastructure the ecosystem.
This last year has seen unprecedented progress and development in the bitcoin and crypto arena. From the price reaching new highs to an explosion in Initial Coin Offerings.
The fall in price by over $1,000 should serve as a reminder that markets will stumble when they try to run before they can walk. As much as early adopters like to declare bitcoin the new currency and declare is true safe haven, the last week has shown that gold is a far better long-term safe haven.
Government meddling
Reasons for bitcoin’s (and other cryptos’) fall last week was mainly thanks to further crackdowns on bitcoin exchanges by the Chinese government. On Thursday bitcoin fell 16% against the U.S. dollar as the Chinese announced they were closer to shutting down cryptocurrency exchanges.
This week commentators believe crypto traders have now priced in the negative news from the East, however last week’s performance was yet another example of how vulnerable bitcoin still is to government announcements.
This weekend and this morning the price has begun to recover following a report from the Bank of International Settlements.
The BIS report said central banks needed to carefully consider their approach to the cryptocurrency markets.
“Central banks will have to consider not only consumer preferences for privacy and possible efficiency gains — in terms of payments, clearing and settlements — but also the risks it may entail for the financial system and the wider economy, as well as any implications for monetary policy,”
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