A visual representation of the Bitcoin cryptocurrency on November 20, 2018 in London, England.
Jordan Mansfield | Getty Images News | Getty Images
GUANGZHOU, China – Bitcoin and other digital currencies plummeted on Monday, eliminating about $ 170 billion from the entire cryptocurrency market.
The market capitalization or value of the cryptocurrency market was $ 959.53 billion at 12:10 pm Singapore time, compared with $ 1.1 trillion a day earlier, according to Coinmarketcap.
Bitcoin, the largest cryptocurrency, fell more than 11% from the previous day to $ 35,828.06, around 12:15 pm, Singapore time. Ether, the second largest, fell about 15% to $ 1,126.72.
Settlement in cryptocurrencies comes after a big spike and may signal some profit-taking by investors. Bitcoin is still up 340% in the past 12 months and last week reached an all-time high, just below $ 42,000.
Bitcoin’s resurgence has been attributed to a number of factors, including more purchases from major institutional investors.
It has also been compared to “digital gold”, a potential safe haven asset and protection against inflation. In a recent research note, JPMorgan said that bitcoin could reach $ 146,000 in the long run, as it competes with gold as an “alternative” currency. Investment bank strategists noted, however, that bitcoin would have to become substantially less volatile to reach that price. Bitcoin is known for large price swings.
But some critics of bitcoin – like David Rosenberg, economist and strategist at Rosenberg Research – have called bitcoin a bubble.
Long-term optimism around bitcoin remains, however. Last week, Chamath Palihapitiya of Social Capital said that bitcoin could exceed $ 100,000.
“It probably goes to $ 100,000, then $ 150,000, then $ 200,000,” Palihapitiya told CNBC’s “Halftime Report”. “In what period? I don’t know. [Maybe] five or ten years, but it is going there. “