The value of bitcoin plunged last week, amid fears that trading was about to be banned in South Korea. It then stabilised briefly, before plunging again.
The volatile cryptocurrency hit a record high when it passed $19,850 in mid-December, but then tumbled rapidly, falling to below $12,000 within days.
Its value has shifted unpredictably ever since, with frequent wild drops and recoveries. The rapid drops are partly the result of continuing fears about regulation, as well as anxiety provoked by a series of high-profile raids and thefts.
It is worth $7,920 as of monday morning UK time, according to the Coinbase exchange. It has fallen almost 11 per cent over the last day – after an already worrying plunge.
Its value is down nearly 29 per cent from a week ago and more than 52 per cent from a month ago. But it is still up more than 674 per cent from a year ago.
South Korea is no longer allowing people to trade bitcoin and other digital currencies anonymously, but says it isn’t planning to ban cryptocurrency exchanges.
Theresa May has hinted that the UK government could introduce similar measures, and the US government is concerned about bitcoin’s popularity amongst criminals.
Recent goings-on have demonstrated just how quickly things can change for investors.
The cryptocurrency’s value plummeted ahead of Christmas, dropping by almost $2,000 in just an hour at one point, and almost slipping below the $11,000 mark. It then bounced back, before tumbling again in mid-January.
Bitcoin is notoriously volatile, and its value is expected to continue to shift unpredictably.
Its rise has also led to increasing amounts of interest in other digital currencies, such as ethereum, litecoin and Ripple XRP, and more and more people are now looking to invest in digital currencies.
However, there are serious fears that bitcoin has created a bubble that could burst at any moment.
Numerous financial experts are advising potential investors to avoid getting involved with bitcoin, and the SEC has told people to “exercise caution” and be wary of scammers.
But others are speculating that it could keep rising towards the $1m mark.
Bitcoin has no central bank and isn’t linked to or regulated by any state.
An anonymised record of every bitcoin transaction is stored on a huge public ledger known as a blockchain.
However, transactions made with the cryptocurrency are irreversible, which makes investors in bitcoin attractive targets for cybercriminals.
This article is being regularly updated to reflect bitcoin’s latest value.
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