Bitcoin has started the year with another drop in its price. It’s the first time since 2015 that the cryptocurrency has started a calendar year with a fall in value. The virtual coin traded at $13,624.56 in the U.S. on Monday, down 4.8 percent from Friday. This is a fall from the final day of trading of 2017 when the price was at $14,156. The disheartening start to the year is in direct contrast to the January of 2017 when the cryptocurrency began its year of huge gains. On the first day of trading in January bitcoin rose 3.6 percent holding a value of approximately $998.
The small bear market for bitcoin comes as various commentators continue to dismiss bitcoin’s viability going forward. According to David Stockman, President Ronald Reagan's former director of the Office of Management and a relentless Wall Street bear, the cryptocurrency boom will end disastrously.
"It's basically a class of really stupid speculators who have convinced themselves that trees grow to the sky," he told CNBC's "Futures Now" last week. "It will burn out in a spectacular crash. All of these latter-day speculators will have their hands burned to a crisp, and they will learn the proper lesson."
Stockman blamed the Federal Reserve and central banks for creating the hype surrounding the stock and cryptocurrency markets. He argued that too much liquidity was pumped into the marketplace to deal with the 2008 global financial crisis — noting that not even regulators can improve the frothy situation.
"What we really need to do is not think these are regulator problems, but understand they're monetary problems," he said. "It's an irrational, overheated market like never before."
The lull in frenzied bitcoin trading has also seen a reemergence of conspiracy theories as to why bitcoin’s price rose so rapidly in 2017. Investopedia reported that some believe the market may have been manipulated by North Korean dictator Kim Jong Un.
It is known that North Korea did take an interest in bitcoin last year, with reports that the rogue country had started mining bitcoin in July and another report in September suggesting that the country was actively attempting, sometimes successfully, to hack bitcoin exchanges.
During 2017 Bitcoin rose up more than 1,300 percent. The rapid growth in bitcoin created a huge amount of wealth for early investors in the untested cryptocurrency. Despite one of bitcoin's original goals to be an alternative currency that could be used to buy goods and services, there are still only limited options to trade coins for products.
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