Bitcoin Plunges by $1,700 in Fifteen Minutes
After eight weeks of consistent growth, Bitcoin has seen a significant drop in valuation as of June 25th, 2019. Bitcoin was moving towards its highest estimate ever of $14,000.00 when an error message is seen on the cryptocurrency exchange “Coinbase”, saw many investors sell their BTC’s and for the valuation to fall by $1,700.00. This puts Bitcoin back to a trading value of $12,515.00 and will need to see significant trading volumes if its valuation is to exceed past $14k now.
Bitcoin is still up by 240% after its eight week high. Bitcoin has already begun regaining its momentum, with trading on the 26th and 27th not slowing down. However, the valuation now remains below its peak value of $20,000.00. It’ll be nearly impossible for Bitcoin to surge past this valuation again with the upcoming Libra Crypto Coin.
The Surge Relates to Project Libra
Bitcoin saw a significant rise in trading volumes before the Coinbase Error. This rise in trading volume is attributed to Facebook announcing Project Libra, a cryptocurrency that will be used across messaging services like Messenger or WhatsApp. Facebook has opened a second company called Calibra to handle all the business activities relating to Libra. This announcement saw an increased interest in cryptocurrencies for the first time since winter, 2019. The Libra Coin will be available to two billion users across these two messaging services when Facebook launches their new cryptocurrency. Users will be able to use the coin towards purchasing items through various online stores.
The Senior Marketing Analysts with Oanda, Craig Erlam, spoke publically about Facebook’s Libra Coin by saying: “The latest rally appears to be tied to the launch of Facebook’s Libra coin and the publicity it has received. Whether people see this as legitimizing cryptocurrencies — being tied to Facebook — or the size of the rally has attracted people seeking quick profits, like back in 2017, isn’t important but it’s helped it find its groove again.”
There have also been analysts that have attributed the rise in Bitcoin to the fact that central banks worldwide are experiencing all-time low-interest rates. There have also been predictions that institutional and retail clients are looking to diversify their portfolios, resulting in the increased Bitcoin trading volume. However, this would prove false as also digital currencies like XRP or Ethereum have seen increased trading volumes as well.