Bitcoin price (BTC/USD) recovers following late week plunge

Bitcoin (BTC) seems to have stabilized somewhat after plunging more than $400 late last week.

Bitcoin price (BTC/USD) recovers following late week plunge

One BTC is currently trading at $8,130.91, according to data from CoinMarketCap, down a paltry 0.59% in 24 hours.

Bitcoin’s had a rough year, generally speaking, since closing in on $20,000 per coin late last year in the run up to Christmas before crashing spectacularly in early 2018.

Indeed, the price of BTC hasn’t broken the $10,000 threshold since March despite the increasing news coverage and hype around the coin.

Brighter times ahead? 

However, according to an article published by Forbes today, the coin may be on the verge of a long overdue bullish run.

According to the mining community, Bitcoin’s hash rate is rapidly surging; in simple terms, a coin’s hash rate indicates the number of calculations being performed per second by miners attempting to earn BTC.

A higher hash rate means more people mining and more Bitcoins being released; according to the article the next halving of the reward is expected to occur in May, 2020.

Bitcoin hash rate

To limit release and avoid hyperinflation, Bitcoin’s creators made it so that roughly every 210,000 blocks, the reward miners earn would automatically half.

In May, 2020, the reward is expected to drop from 12.5 BTC to 6.25 BTC.

Despite the mass selling off of Bitcoin, the hash rate has continued to increase at an alarming rate which, according to experts, is a very positive sign.

Bitcoin continues to split opinion

Opinion remains split over the future of the world’s number one cryptocurrency; many critics believe its had its day and failed to live up to the hype while others believe the sky’s the limit for BTC with some claiming that coins will be selling for $500,000 by as soon as next year.

Outspoken crypto-nut and ex-purveyor of intrusive anti-virus software, John McAfee, for example, has been very vocal in his support of Bitcoin.

In fact, he once famously vowed, via Tweet, to ‘eat his dk’ if Bitcoin isn’t at $1 million per coin by the year 2020.

To be fair to McAfee, he has since back-peddled on his prediction somewhat; in July of 2017 he made a bet that one single Bitcoin would be worth $500,000 (not a million) in three years time.  See below:

"You're just hoping the next guy pays more"

Others, such as billionaire Warren Buffett, are less convinced by the crypto-mania that’s swept the globe in the last year or two.

Buffett told Yahoo Finance: "If you buy something like bitcoin or some cryptocurrency, you don't have anything that is producing anything.

“You're just hoping the next guy pays more. And you only feel you'll find the next guy to pay more if he thinks he's going to find someone that's going to pay more.

"You aren't investing when you do that, you're speculating.”

Warren Buffett

Bitcoin is certainly a head-scratcher – with an infrastructure modelled on natural resources such as oil, gold or diamonds (in that Bitcoins are mined and the more they are mined, the more scarce they become), one glaring discrepancy in this analogy is that Bitcoins cannot be burned for fuel or fashioned into jewellery.

They have no practical use and only retain their value so long as people continue to ascribe a value to them.

However, crypto enthusiasts routinely dismiss such fears or doubts like those expressed by Buffett.

Many claim that a lot of the old-school investors and stock traders, such as Buffett, simply do not understand or appreciate the value of cryptocurrencies and the underlying blockchain technology.

Only time will tell who's right re the future of cryptos...

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