Bitcoin falls 6%, raises doubts on crypto boom

Bitcoin and other digital currencies took a plunge on Thursday and subsequently the fall has raised questions about the durability of the boom in cryptocurrencies. Bitcoin’s shares price dropped to $17,657.53 i.e. by 5.74 percent, after losing $1,074.9 from its previous close. The world`s biggest cryptocurrency has rallied by 358.6 percent from this year`s low of $3,850 on March 13.

Bitcoin dropped as much as 8.7 percent, the highest observed since early August, while other digital coins like Ether witnessed a percentage decline in double-digits. The Bloomberg Galaxy Crypto Index at a point of time dropped more than 6 percent.

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“Conditions are very massively overbought and bound for a correction, So I don’t think it’s unusual frankly. I still believe we’ll see all-time highs before a larger drop/correction,” said Vijay Ayyar, head of business development with crypto exchange Luno.

Even with the decline, Bitcoin has gained in double-digits this year and until recently was standing on the pedestal to create a record high of $19,511 set in 2017. Crypto believers cite purchases by retail investors, institutions and even billionaires, as well as the search for a hedge against dollar weakness, as the reasons as to why the boom can last.

Critiques sceptic about Crypto argues that the cryptocurrency’s famed volatility portends a repeat of what happened three years ago when boom turned to epic bust.