The Bitcoin market has been volatile since the very beginning. The prices have never been consistent and there was always steep ups and downs which influenced the prices. However, recently there have been a massive drop in prices which was seen in the cryptocurrency market. It has caused investors around the world to worry about the markets and they have become ever more aware of the situation. The prices of Bitcoin fell down by almost 25% and that is a huge slump in this current situation.
Not only Bitcoins, other cryptocurrencies have also seen a similar slump in their prices recently. But, on the other hand, experts have observed that there have been a rise in the prices of Bitcoin Cash. So, why is this so? There are different reasons for this change in situation. Let us take a look at them in this article.
Reasons For The Drop in Bitcoin Prices
Bitcoin prices are dependent on a whole lot of factors which influence the market significantly. But here are some really important reasons which have been responsible for the slump.
Mining is becoming expensive – as time goes, Bitcoin mining is getting more expensive than ever. The entire Bitcoin structure is dependent on these very miners who will need to mine the currency and invent the new blocks in order to keep the flow intact. But, a number of factor is going to impact that process. The Halvening Event is going to happen in 2020 and that will reduce the reward awarded to the miners. As mining gets more difficult and more expensive, rewards are getting halved after every 4 years. Hence, the number of miners are decreasing drastically around the world. unbegrenzte Profite is now impossible.
Serious regulatory concern – regulatord around the world have started focusing on cryptocurrencies with different views and perspectives. Many countries are trying to facilitate the use of Bitcoins and other currencies in their territory, while many have banned this decentralized medium of currency. Hence, it is important that more institutional investors invest in the market and help to develop brand new elements like the crypto-specific exchange-traded funds (ETFs).
Manipulation in the market – serious market manipulation and speculative activities have affected the prices of cryptocurrencies over time. Well informed and learned traders buy the currencies in bulk and that causes the prices to push towards the higher side. Hence, they get other buyers to purchase these currencies. Then they sell their assets at the higher prices and bring thr market down with a slump again. This kind of pump-and-dump activity have caused massive changes in the cryptocurrency market this year.
Massive power consumption – a not so direct but yet a reason that is contributing to the fall in the prices of cryptocurrency is the factor of power consumption. Mining Bitcoins is a power hungry process which needs to be executed throughout the year, most of the times. Mining Bitcoins for half of the day consumes the energy equivalent to running all the equipment in your house for the day. Hence, many authorities in many countries have cracked down on the mining of Bitcoin for conserving energy and prevent such huge usage. Thus, mining activities are decreasing and the amount of Bitcoins produced is also slumping with every passing year.
So these are the top reasons why the prices of Bitcoins are witnessing a downward trend in 2019. All these factors have had a direct impact on the prices of the Bitcoins and will continue to affect the resources for the time being. Now we will take a look at why Bitcoin Cash is rising.
Why is Bitcoin Cash Rising in 2019?
When the Bitcoin prices are coming down, right at the other hand, Bitcoin Cash (BCH) markets are witnessing an upward trend and have lead the top 10 cryptocurrency pack with a 2.17% gain in prices in just 24 hours. The market capitalization of BCH is somewhere around $6 billion and there have been more than $1.27 billion in global trades, making it the 6th largest cryptocurrency by volume of trade. Experts belive that Bitcoin Cash has a great potential to become one of the leading currency in the coming years and will expand even more.
The prices of BHC will surely go on to be much higher than 2019, in 2020 and markets will possibly see an all time high the next year. The prices are already bullish and buyers have massively beem returning in droves. They are currently acclamating resources heavily. This is became they are expecting huge returns from Bitcoin Cash in the near future. The target for next year will be somewhere around $1200 and experts believe if the currency continues to perform this way, the price may reach the levels.
What Does The Future Hold?
2020 is going to be an interesting and important year for the cryptocurrency market. As it is people are concerned about the Halvening Event which will have a significant impact on Bitcoins, other cryptocurrencies are also tend to suffer a setback of some kind. Bitcoin Cash might perform really well in 2020 and experts are putting up a traditional target of $800 and an aggressive target that is near around $1200.
Even though it is not impossible for the prices to reach these targets, it is not that easy as well. Most of the factors are much different now, from when Bitcoin Cash reached it’s all time high price of above $4000 back in 2017. So, only time will tell whether the prices of Bitcoin Cash will continue to go upward or come down with several other cryptocurrencies in 2020.
Final Words – cryptocurrency markets are volatile at the current moment. If you are planning to make unbegrenzte Profite, then this might not be the time to trade short but long term. As the new year is approaching, the changes in the Bitcoin market remains to be seen. Invest and trade carefully in the market.