Bitcoin at crossroads after shedding nearly $20 billion in value
Bitcoin and other digital currencies have been getting absolutely toasted in recent trade, with some wondering if withering criticism from Wall Street heavyweights, like J.P. Morgan Chase’s JPM+0.29% CEO, and growing regulatory scrutiny in China have finally combined to exact a punishing, and lasting, toll on one of the most bubblicious segments of finance.
On Wednesday, the value of a single bitcoin, near its low, was at $3,772, compared with around $5,000 in early September and representing a roughly $18.5 billion loss of market value in the world’s No. 1 cryptocurrency, according to digital-currency site Coinmarketcap.com. Ether tokens, the second-most popular digital currency, were down more than 11% at $260.13 in recent action. That equates to a loss of more than $11 billion in total value for the currency running on the Ethereum blockchain.Still, bitcoin’s rise has been dazzling, rallying some 300% so far in 2017. By comparison, the Dow Jones Industrial Average DJIA+0.18%and the S&P 500 index SPX+0.08% are each up by nearly 12% this year, sparking a litany of pronouncements that U.S. equities are too rich.At least part of the drop in bitcoin is due to excoriating comments made by Dimon on Tuesday, who referred to it as “a fraud”, among other indictments, at a banking conference. He reiterated those remarks at a separate conference later that day.On Wednesday, prominent investor and market pundit Mohamed El-Erian, chief economic adviser at Allianz Global Investors, added further fuel to bitcoin’s bearish fire, making the case that bitcoin might lose a third or half its value.