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Bitcoin Ends Decline After Losing Near Third of Record Value

November 13, 2017 at 14:35 by Yahia Barakah

The price of Bitcoin began to display signs of stability on Monday after a massive drop that erased 29%, or $38 billion, from Bitcoin’s total market value. The virtual currency began recovering today as traders worried that the quick and sharp decline may have been an excessive response to the cancellation of a long awaited technical upgrade.

Bitcoin was seen moving near $6,600 today after falling from $7,838 on Wednesday to $5,580 yesterday. The price crash happened as investors rushed to move their capital to other rival virtual currencies. One such rival is Bitcoin Cash, which split from the original Bitcoin back in August, has climbed about 19% since Friday.

The crash followed the cancellation of an upgrade that would have increased the size of each block on Bitcoin’s blockchain network. A bigger block size allows more transactions to be carried out at the same time, which reduces transaction fees and increases speed.

A similar upgrade has already been incorporated into Bitcoin Cash, which gave the alternative cryptocurrency popularity and strength following its lunch. Meanwhile, the upgrade to the Bitcoin network was called off after an important faction of the cryptocurrency community withdrew its support. The sudden upgrade cancellation resulted in strong volatility and extreme price movement even by Bitcoin’s standards.

Bitcoin investors now are left with two choices. The first choice is to stick to the original Bitcoin, which uses SegWit technology to move unessential data off the underlying blockchain. The second choice is to move to Bitcoin Cash, which uses a block size that is eight times bigger than the original Bitcoin. The choice many investors appear to be making today is the first.

Bitcoin’s price was quick to recover over 13%, or $10 billion, during today’s trading. Bitcoin’s total market capitalization currently stands at $102 billion, which makes it hard for investors and fund managers to resist the digital asset. Demand for the currency remained high following regulatory moves and increased investment accessibility, like CME Group’s recent plans to offer Bitcoin futures contracts.

BTC/USD traded at 6,588.8 on the Bitstamp exchange as of 14:10 GMT today after rising to 6,730.3 at 13:30 GMT, the pair’s highest level since November 11. BTC/USD began trading today at 5,870.3.

If you have any questions and comments on Bitcoin today, use the form below to reply.

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