Bitcoin’s volatility is renowned but the yo-yo movements of the cryptocurrency last night were dramatic, even by its standards. After hitting an unprecedented value of $11,000 (€9,298), Bitcoin crashed by $2,000 last night, rallied to a high of $10,500 this morning but then dropped back to $9,500.
The cryptocurrency’s value has surged more than tenfold this year alone and traders have described it as one of the biggest bull markets in history. Once the domain of the technically-savvy, hundreds of thousands of people across the world are now buying Bitcoin in an attempt to gain some extra cash by the side. The popular crypto-exchange platform Coinbase said it experienced all-time high traffic yesterday, eight times higher than its previous peak in June, and that it added 100,000 new users on Monday alone. Another popular wallet service, Blockchain.info, reported over 120,000 new users yesterday.
We are experiencing all time high traffic at the moment – 8x the peak we saw in June
— Coinbase (@coinbase) November 29, 2017
Bitcoin’s future in photos. pic.twitter.com/45sMn7kSc1
— Patrick Scott Patterson (@OriginalPSP) November 29, 2017
However, Bitcoin’s notorious volatility – as evidenced last night – have led crypto-sceptics to warn dangerous speculation is going on, fuelled by the madness of the crowds.
Nobel Prize winning economist Joseph Stiglitz described Bitcoin as a bubble that should be banned, while European Central Bank vice-president Vitor Constancio has compared it to the Dutch Tulip Mania of the 17th century. “The madness of crowds is well documented, but it is quite something to behold in the flesh. It’s hard to keep up with this – bitcoin just flew past the $11,000 mark, leaping $200 in barely five minutes before taking another big leg higher,” said Neil Wilson, senior market analyst at ETX Capital. “It’s up more than 14% today alone and the year-to-date chart is simply staggering. There are no fundamentals or technicals that explain this other than it being a massive speculative bubble.”