Bitcoin fluctuates, after a record it fell by up to 17 percent

Bitcoin fluctuates, after a record it fell by up to 17 percent

The price of bitcoin continues to fluctuate significantly. It fell sharply on Monday since last March, after reaching over $ 34,000 (€ 27,707.60) for the first time on Sunday. The oldest and most famous cryptocurrency lost as much as 17 percent on Monday and lost weekend gains. After a sharp strengthening in 2020, Bitcoin also started the new year with spectacular growth, and on Sunday its price reached USD 34,182.75. However, on Monday, bitcoin was sold in London at a loss of 13 percent to $ 29,168.

The price of bitcoin rose sharply in the fall

At the beginning of 2020, bitcoin sold for about $ 8,000, then, during the first wave of the new coronavirus pandemic, its price dropped below $ 4,000. Later, a slow strengthening began, which accelerated sharply in autumn 2020. Since the end of September, its value has risen by about $ 20,000. The immediate cause of the current bitcoin volatility is unknown.

What was behind strengthening bitcoin

There were several factors behind its strengthening last year. Increasing its acceptance among investors is considered to be the most important. The PayPal payment service, which wants to enable its users to make payments in digital currencies, has greatly contributed to this. Another factor was the increase in demand from institutional investors who buy bitcoin as a hedge against inflation, similar to gold. This is due to unprecedented fiscal and monetary incentives to support economies during the new coronavirus pandemic. However, experts also warn against the risk of extreme fluctuations in the bitcoin exchange rate. Three years ago, its price fell by about 70 percent in a short time.