Bitcoin USD price going down as the market is flooded with offers
The bitcoin lost a lot of its value in a week. "It's madness," says a trader who has been looking for a job to pay his rent. Still, he continues to believe in the 'hyped' coin. "The long-term developments are positive."
2018 is a disaster year for bitcoin investors. The currency is now around 80 percent below the peak value of $ 20,000 at the end of last year. Other crypto coins, along with the bitcoin, also went down in the fall.
A trader gave in the Wall Street Journal a simple explanation: "Panic." Speculators are withdrawing and the miners, people or companies, that have made their computers available for complex calculations with which the digital coins can enter the market lose interest in the bitcoin.
But this year's crash is not even the biggest for the bitcoin. In 2011, barely a year after the trade in the crypto coin began, there was already a dip of 93 percent. And there was the 84 percent dip spread over a longer period between 2013 and 2015. But the total depreciation is unprecedented: more than 700 billion dollars according to CoinMarketCap.com, Bloomberg reported.
"It's just a dip," says Timo Moors from crypto dealer Canarypete. He saw the value of his investment in crypto coins largely evaporating in recent months. And had also seen the beginning of the year coming. Moors, together with a partner in a shed in Amsterdam, had a number of computers that 'mined' crypto coins.
In January this year they stopped. "It was two good years, but we already saw that it had to stop." With, among other things, the coins produced (in their case ethereum, a counterpart of the bitcoin) they started trading. "In the hype nobody was critical anymore, it was insanity but we still saw that every day something came in. Then you think, we're still waiting for a day with sales."
Meanwhile, the piggy bank that has been built up in recent years has been decimated. "I've been freelancing again since a month," says Moors. "Because I do not want the pot to get any further empty, but fortunately I can still pay my rent."
A minimum of 600,000 bitcoin miners have been shut down since November 2017. That is what the founder of the third largest mining pool F2pool told us. New mining equipment is becoming more expensive and many miners still use outdated equipment. The decreasing yields often no longer outweigh the production costs that also consist of electricity. The electricity price in the minersland of China has increased over the past period. This is due to the dry summers, so that hydropower plants produce less.
Despite all the misery, Moors continues to believe in the crypto coins. "The market is becoming more mature, and we have come out better after every dip." According to him, it is the art to invest in coins with a lot of technology behind applications.
"Because blockchain technology is going to really change a lot of organizations, such as insurance companies, or Airbnb, because it's about how many devices will use the technology, or what is the currency's" usercase. "If the applications where the technology is used work, the coin will automatically worth more. "