The Ups and Downs of Cryptocurrencies

So far 2021 has been a big year for cryptocurrencies especially for Bitcoin who has been backed by the renowned business magnet Elon Musk. 

But we’ve seen the price of Bitcoin fluctuate both up and down, since the start of the year when it hit a record high of above $57,128 but then days later dropped by 15%.  Bitcoin’s price surged due to Musk’s Tesla investing 1.5 billion U.S. dollars in the cryptocurrency.

Bitcoin dominates the market constituting 66 percent of total market cap of all cryptocurrencies in 2020 but other cryptocurrencies have also been volatile.

The price of ethereum (ether) hit a new all-time high amid predictions of an impending supply shortage which would force the price up even higher.  The cryptocurrency hit the $2,000 milestone late on February 19^th but recently it had a massive price drop that took it down to $1550 before seeing a recovery to $1,800.   

The world’s fifth largest cryptocurrency, Ripple, has seen a price cash from a high of $0.78 to $0.177 and the cryptocurrency, Litecoin, has seen incredible gains of over 350% since late September 2020 but saw significant sell offs.

Bitcoin was one of the first cryptocurrencies and back in 2015 held 86 percent of the market.

Cryptocurrencies are virtual or digital currencies that have no centralized regulating authority. It means that money is created and transferred without the intermediation of banks. Cryptography is used a means of ensuring transaction security.

Bitcoin has had a volatile trading history since its creation in 2009. The first price hike occurred during 2013 when one bitcoin was trading at around 1,124 U.S. dollars in November. Four years later, bitcoin experienced a meteoric rise and reached record highs, with some exchanges having the price of a single bitcoin at approximately 20,000 U.S. dollars in late 2017. However, prices soon started to tumble in the months that followed.

2020 was the strongest year for the currency with around 18.5 million bitcoins in circulation worldwide, and the market capitalization of Bitcoin was approximately 200 billion U.S. dollars.

Markets continue to closely watch the cryptocurrencies as they rise and fall.  

Of course, not all cryptocurrencies have witnessed the success that Bitcoin has done. One currency which we covered in a different post, Funfair (FUN), designed to be a blockchain casino currency, saw its’ greatest uplift at $0.19 on January 8th 2018 but has never come close again, currently languishing at $0.033 today. While Bitcoin continues to soar and with speculation rife about the potential of other coins, be wary that Bitcoins’ remarkable surge may not trickle down to all the other cryptocurrencies.