Bitcoin hasn’t been doing very well lately. The cryptocurrency’s price is still above $30,000, but it doesn’t do justice to the rally it had. A while back, the currency was trading above $40,000 and then suddenly retracted by 25%. Even after that, the prices of the currency recovered and went to almost $39,000. But now another strong Bitcoin pullback took place, and the prices have fallen again by 11% on Thursday. It is difficult to say what the future has in store for the currency because the market doesn’t seem very bullish right now.
Why did Bitcoin fall again?
The recent fall in the price of the currency is due to the recent bug that surfaced. It is known as the “double-spend” bug, allowing users to spend the same Bitcoin twice. Though this bug was actually a rumor and didn’t actually happen, it was a good enough reason for people to exit their positions. Recently the analysts at JP Morgan also said that if the currency doesn’t reach $40,000 again, then a crash is near. But, if it does reach that price, there might be a huge price increase too.
Another important factor that resulted in its price’s downfall was the recent nomination of the US’s treasury secretary. Janel Yellen said that she wants lawmakers to reduce the use of Bitcoin as it is used in a lot of illegal activities. And if that happens, the prices of the currency will be affected drastically. We might even see the currency getting banned in the long run, if Bitcoin actually gets near to overturning the dollar’s value.
More about the double-spend bug and bitcoin’s future
This bug was thought to be fixed when the Bitcoin white paper was published in 2009. But recently a tweet by BitMEX suggested that they detected a small double-spend amount of about $21. It later corrected itself saying that the transaction wasn’t actually Bitcoin but an RBF transaction. BitMEX also pointed and cleared out that the double-spend didn’t actually occur. But the important thing to note is that one single tweet by the company resulted in such a huge downfall in the currency’s prices.
Well, if the currency can recover again it will be great as the market might change to bullish. But for that to happen and the currency reaching $40,000, at least $100 million worth of transactions are required in the currency every day. Only if that happens we have a bright future for the cryptocurrency. This is because if the prices fall further I don’t feel it’s going to recover again.
What are your thoughts on the strong bitcoin pullback that happened on Thursday? Do let us know in the comments below. Also, if you found our content informative do like it and share it with your friends.
Also Read: SpaceX’s next satellite launch is scheduled today
