Further Fall of Bitcoin May Infect Other Markets
December 22, 2017
If Bitcoin's price continues to decline, it could affect other markets, says Ron William, founder and principle market strategist at RW Market Advisory. The rate of BTC has fallen by more than 16% in the last 24 hours, and at some points it fell below $13,000.
William believes that the current drop in the price of the cryptocurrency is "quite normal", but if it continues, and its pace increases, it can infect the market and provoke a fall in the rates of other goods.
"Bitcoin's rate has dropped by 75% three times in its history. I believe that it is important for my clients and market participants to distinguish between the price and the possibility of long-term destruction of Bitcoin and the blockchain as a whole. The price is extremely irrational, and if the fall continues further, it could infect other markets," William said.
The cost of Bitcoin has fluctuated tremendously throughout the week: on Monday the currency was traded at $19,000, then in the course of the week it began to decline and eventually fell below $13,000 on Friday, although then it rose again and exceeded $14,000.
"If the price returns to the level of $ 17,250, and further to the historical maximum, the rate can eventually grow very much by New Year, and many people have already talked about it," William said.
"However, I do not think that it depends only on Bitcoin and other cryptocurrencies. In any case, it seems interesting to me to prevent some risks on other markets, because so many people have invested in cryptocurrencies. Perhaps we will observe deleveraging," he said.
Deleveraging is a financial concept, consisting in the process of reducing the volume of borrowed funds invested in an asset. Usually it happens when the value of this asset falls.
Today was marked by a fall in the rate of all the cryptocurrencies. As of 16:30 Moscow time, the rates of only two out of the first 100 cryptocurrencies placed on Coinmarketcap have increased in the last 24 hours.