The price of Bitcoin gave up all of its weekly gains to trade below $1,200 on Friday as optimism toward new legislations in Japan wore off. The virtual currency’s investors became once again concerned about the scalability of the Bitcoin system amidst what appears to be a spam attack of transactions that left the blockchain network with over 55,000 unconfirmed transactions.
The price of Bitcoin gained as much as $50 during the current week, to touch a level last seen on March 16 following a move by Japan that allowed the use of the digital currency as a payment method. The news was soon followed by a report that stated that the Russian government is possibly looking into recognizing Bitcoin as a legal financial instrument in 2018.
Russian Deputy Finance Minister Alexey Moiseev said in an interview this week that the authorities hope that, by regulating the digital currency, the government will be able to stop its usage for money laundering.
However, attention switched to the underlying system of Bitcoin, as a massive number of transactions that are awaiting confirmation accumulated in the blockchain network. The incident, which has repeated multiple times in the history of Bitcoin, seems to be aimed at cutting the price of Bitcoin down by crippling its network.
Users of the currency have to pay higher fees to get their transactions confirmed faster when the blockchain network is congested, which stoked the debate of the scalability of Bitcoin. One of the most common solutions for the problem is to increase the size of each block on the blockchain network, which is currently being voted on by Bitcoin users.
BTC/USD traded at 1,179.9 as of 15:10 GMT on Friday, from 1,150.5 at 17:25 GMT, the pair’s lowest level since April 6. BTC/USD began trading today at 1,174.4.
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