In our predictions for 2015, we had a feeling that bitcoin (BTC/USD) would break through $200. But we didn’t expect it to happen this fast.
And when checking the price for the first time this morning, the scale of loss took a few moments to register. It first looked like a quote in euros.
The price of bitcoin crashed to its lowest point since October 2013, virtually wiping out the last of its gains from the late 2013 rally.
Bitcoin plunged by as much as 25% to as low as $176.50 on BTC-e, its lowest point since October 2013. The steep loss is in addition to yesterday’s drop of over 13%. Year to date, BTC has already shed 44% of its value. Since its November peak near $1,100, it has lost 84% – a figure we’re more used to when it comes to some altcoins.
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Litecoin fell as low as $1.22, bringing its total losses in 2015 to 54%.
In a vicious cycle, panic-stricken traders were dumping bitcoins at a feverish pace, thereby stimulating even more selling. With its underpinning book value highly unclear, traders also feared the worst. Margin calls on leveraged positions likely contributed to the cascading effect.
Volumes on BTC-e spiked to as high as 9,000 BTC/hour when the selling reached its climax.
Prices have since bounced back to $188 but have yet to show signs of setting a floor.
Bitcoin community reaction to the recent price weakness has been mixed. Some expressed genuine concern over Bitcoin’s future. Others say that it’s not about the price. And others still express confidence in a future recovery, pointing to previous crashes of even greater proportions.