Story by: Billy Bambrough
Bitcoin has been struggling recently after a period of stability, suddenly moving sharply lower at the end of last month.
The bitcoin price, which is still up more than double from where it began the year, fell from its recent plateau of around $10,000 per bitcoin to just above $8,000 in a move widely put down to the lackluster performance of the hotly-anticipated Bakkt bitcoin and cryptocurrency platform.
Now, new data has suggested the slump in the bitcoin price might be more to do with the “coming of age” of bitcoin and cryptocurrency markets–with exciting new competitors distracting investors from the long-time crypto poster-boy.
Bitcoin, cryptocurrency and financial markets research company Indexica has found that bitcoin’s strongest predictive measure was its “quotability,” it was first reported by Bloomberg, a financial newswire–meaning traders are treating it like any other investment asset and showing bitcoin is most often being talked about in conjunction with more traditional currencies.
“Now that bitcoin is a big kid, anything can make it move, just like anything can make gold or a G-10 currency move,” said Zak Selbert, chief executive of Indexica told Bloomberg, adding bitcoin’s sensitivity to new competitors such as Facebook’s troubled libra project and Mastercard’s partnership with R3 demonstrates the industry’s maturity.
“Bitcoin is part of the financial landscape in a very intertwined and mature way.”
Many bitcoin and cryptocurrency watchers had hoped that bitcoin’s reputation as “digital gold” would mean it began acting as a so-called safe haven asset, with investors buying into bitcoin at times of political and economic uncertainty.
This appeared to happen earlier this year, until the bitcoin price moved sharply lower as gold and the Japanese yen, two traditional safe havens, climbed.
Meanwhile, some have suggested bitcoin’s recent bounce back over $8,000 earlier this week was due to the U.S. Federal Reserve’s plans to pump cash into the financial market to boost bank balance sheets and drive inflation.
“We know that [Fed easing] has historically helped bitcoin,” Joe DiPasquale, chief executive of the bitcoin and cryptocurrency investment firm BitBull Capital, told bitcoin industry news site Coindesk.
Original story: https://tinyurl.com/y3uj5nxlby