Add Category
"There's still a lot of people in this game," Innes, head of trading for Asia Pacific at Oanda, said by phone from Singapore. If Bitcoin "collapses, if we start to see a run down toward $US3,000, this thing is going to be a monster. People will be running for the exits."
The cryptocurrency surge and fall ranks among the biggest bubbles in history.Credit:Bloomberg
Innes said his base-case forecast is for Bitcoin to trade between $US3,500 and $US6,500 in the short term, with the potential to fall to $US2,500 by January.
if we start to see a run down toward $US3,000, this thing is going to be a monster. People will be running for the exits.
Oanda trading chief Stephen Innes
The largest cryptocurrency fell 3.6 per cent to $US4,270 on Friday, heading for its 11th decline in 12 weekday sessions, according to Bloomberg composite pricing. Bitcoin hasn't closed below $US4,000 for almost 14 months.
Rivals Ether, XRP and Litecoin fell between 4.4 per cent and 6.6 per cent. The market value of all cryptocurrencies tracked by CoinMarketCap.com has sunk to $US140 billion, down from about $US835 billion at the market peak in January.
Biggest casualties
Loading
The rout's biggest casualties: individual investors who piled in just as prices peaked, and companies like Nvidia that supplied the crypto ecosystem. The California-based chipmaker has lost nearly half its value since the start of October as demand for its cryptocurrency mining chips collapsed and results in its gaming division disappointed.
The economic impact of the crypto collapse has so far been limited, in part because most major banks and institutional money managers have little to no exposure to virtual currencies.
For most investors, recent declines in equity markets have arguably been far more important: the $US700 billion slump in digital assets since January compares with $US1.3 trillion lost from the market value of global shares just this week.
While some crypto bulls have argued that Bitcoin and its peers would act as havens from turmoil in traditional financial markets, this year's losses have undercut those claims. Gold, a traditional haven for investors, has climbed in the past two weeks as virtual currencies tumbled.
Bloomberg