In June 2017, the controversial digital currency Bitcoin danced around the $3,000 mark even after a couple of established investors voiced their concerns about volatility and the risk of dealing with a financial concept that few people can fully grasp.
Bitcoin has matured to the point of becoming a popular currency pair. Just like foreign currency exchange (forex) traders tend to favor EUR/USD due to its high trading volume and constant news coverage about the value of the euro against the greenback, BTC/USD is now being covered by major financial news outlets such as CNBC. In fact, BTC/USD now merits a mention at the end of the trading session on Wall Street; just after the bell on June 7, the average Bitcoin value at popular exchanges such as Coinbase was around $2,700, which is amazing when considering that only a small percentage of banks and retail businesses around the world accept BTC; however, this has not stopped people such as Jim Cramer, host of the CNBC program Mad Money, from commenting on the ongoing financial craze.
Any currency valued at nearly $3,000 is worthy of discussion, particularly when it boasts as the market capitalization of $44,401,428,739 and a daily trading volume of more than $1.5 billion. In early June 2013, one Bitcoin was worth $121, and its all-time pricing chart does not portray a roller coaster history except for a period between late 2013 and May 2014. For many traders who pour over charts and take market positions based on technical analysis, Bitcoin seems like a good investment, and this is why analysts such as Cramer are discussing it.
Cramer believes that BTC/USD could one day reach the $1 million mark; he did not venture to guess when, but he was responding to the CEO of online publication Business Insider, who believes that $1M BTC/USD could be seen within ten years. Not everyone shares this sentiment; billionaire investor Mark Cuban, for example, posted several Twitter messages questioning the valuation, but not so much the value of Bitcoin, which he compared to gold. It did not take long for Cuban’s comments to impact BTC/USD, prompting a short selloff that shaved off a few hundred dollars off the vaunted currency. Less than 24 hours later, traders shrugged off the analysis and pushed Bitcoin closer to $3,000, which has prompted rumors about the currency reaching $10K by the end of 2017.
In the end, the current BTC situation is a bubble and is not how a currency should behave, but there is no reason to think of Bitcoin as anything other than an asset, albeit one with questionable valuation.