(December 26) After slumping over the holiday, bitcoin's price struggled back over $16,000 briefly on Boxing Day December 26th before falling back a ways. On December 17th it reached a high above $19,500. It then plummeted to just $10,834 on December 22.
|Bitcoin's Boxing Day recovery|
On Xmas day, bitcoin lost almost two percent of its value.The price on opening on Boxing Day was just $13,917 but it rose as high as $16,079 before falling back. It just closed a while ago at $15,745 as it is now December 27th UTC.Reaction to bitcoin's recent dropMost market watchers expected a correction or downturn. Many consider the drop healthy and a welcome correction after the huge gains made recently by bitcoin. Some no doubt expected the downturn to continue as the bubble burst but the price appears to be recovering as it has several times before.Tom Lee a co-founder of Fundstrat, actually raised his mid-2018 target to $20,000 from $11,500. He claims the fair value of bitcoin is $19,103 considerably higher than its current value.Mohamed El-Erian a Bloomberg economist says that the coin's price is at a critical juncture. He argues that if the correction took money out that was invested due to excessive exuberance then the way could be open for the development of a more mature ecosystem for cryptocurrencies. This might protect investors in case there should be a bubble burst. However, El-Erian warned: "Absent this, not even the deep commitment of true believers will be enough to protect individual retail investors who would end up experiencing a price appreciation and collapse that would rival even the biggest investment bubbles in history,"Analyst James Faucette predicts a rocky road in the future for bitcoin. He notes the small number of retailers willing to accept bitcoin in exchange. He said that bitcoin was not like a currency or even like gold. Investment analysts at Morgan Stanley even suggested that bitcoin may soon have a practical value of nothing.Bitcoin is difficult to value making many conservative and traditional investors wary of investing in it.Julian Hosp on bitcoin's futureJulian Hosp a cryptocurrency entrepreneur claims that bitcoin's rise is not yet finished saying: "I think we're going to see bitcoin hitting the $60,000 mark, but I also think we're going to see bitcoin hitting the $5,000 mark." Hosp is a co-founder and president of the firm TenX, a firm that is trying to make it easier for people to spend cryptocurrencies. Hosp says that the question is which level will bitcoin reach first.Hosp said that for experts who have been in the market some time the dip was welcome. He called the elevation of the price over the last months dangerous and said: "This dip for us was very, very healthy, and some of us have used it to buy a little bit more because suddenly we had 40-45 percent discount to all-time highs."Hosp said that he was certain that the bitcoin price will fall again. He said in the long run there would always be an up move and then a dip. He said that a consolidation of cryptocurrencies was likely in the future.While Hosp did not see a cryptocurrency winter coming right away he said that within a year or two the market would see a big compression.Hosp described the situation as follows: "I don't think it's going to be a bubble that's just going to burst and everyone is going to lose their money, but I think it's going to be that all the coins and all the assets with very little use or value are going to get sorted out. The money is going to flow into those assets in this cryptocurrency space that really deliver value, have new technology, and are being used by people." Hosp sees bitcoin as being more like gold than as a currency.