On 13-Oct-2017 In News
"Bitcoin is not an investment rather it is a short-term profit-making machine."If someone had said this to me a year ago, I would not have agreed with them, but now Bitcoin has lost the title of perfect investment. Reason being the sudden fluctuation in its price. Yes, it can make the quick investor profit, but the things can end on the other side too. Hence, not a perfect investment especially now. Bitcoin has seen some uneven growth in the very recent time. The sudden growth in 9-year-old currency has attracted a lot of investors. Though before the rise, Bitcoin saw some decline after it was blocked in China. Right now it is hard to say where the Bitcoins ship is sailing and the saying 'higher risk higher return' might too come true.
The main reason behind the sudden bump of Bitcoin is the news of China might reverse the cryptocurrency ban. It is important to note that Bitcoin has rallied by over 400% since the start of the year.
We have seen a great growth in the recent past in Bitcoin. The crypto-currency which has the 3 months lowest of approx $1900 is trading at over $5500 right now. This is not the first time that this virtual currency has seen such a growth but the future from here is pretty unstable.
Bitcoin and other cryptocurrencies are well-known for being highly volatile, they do show a rapid growth but have a high tendency to fall too. In the June 2017, the currency crossed the $3000 mark but then fall all of a sudden to $1869 with a drop of 36%.
Experts who keep close eyes on crypto-currencies have mixed opinion on its future. A very recent report on CNBC suggests that the investors of Bitcoin are still seeing potential in the currency, hence their bet is still high.
The other half of the experts are avoiding an investment claiming the fact that Bitcoin has meant the profit requirement for most of the buyers. Hence, they will start profit booking as soon as Bitcoin see a little drop.
In Economics, we have a simple concept called Law of supply and demand that simply states a low supply and a high demand increase the price, and in contrast, the greater the supply and the lower the demand, the lower the price tends to fall.
Keeping in mind the Law of supply and demand, Bitcoin will soon see a high supply to the market demand, and hence the price will drop slightly. But the slight price drop can encourage the other investors to sell their Bitcoin at the highest price possible.
So, is Bitcoin a great deal at this time? Well, it is hard to commit, but the flow still suggests that the drop in prices will be the next thing.