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| Abolaji Odunjo, a gadget vendor who trades with bitcoin, poses with his mobile phone at his store in Lagos, Nigeria, in August. Is bitcoin in the era of COVID-19 a global universal currency taking its rightful place or a pandemic buying frenzy that will end in tears? (Temilade Adelaja/Reuters) |
Cryptocurrency crashes through previous US dollar highs, but skeptics say it’s best to beware
A return of bitcoin to its stratospheric highs has top financial experts scratching their heads and cryptocurrency boosters saying I told you so.
On Wednesday, bitcoin crashed through its previous record high of $19,458 US set in December 2017. Bitcoin does not trade on a single centralized market, so quotes can vary based on who assembles the data.
But while supporters insist that things are different this time and a sharp rise won’t lead to a sharp decline, many fear that inexperienced speculators are again going to get their fingers badly burned.
This time around, not only are the peculiar electronic tokens once more on a hard-to-explain upward tear, but as bitcoin has been rising, gold has been falling during the past month.
When I first wrote about bitcoin seven years ago suggesting that it was just like gold, investors in the yellow metal were outraged.
Crypto typo?
In retrospect, that article, “Gold and Bits, Two Sides of the Same Coin,” stands up surprisingly well. But in rereading the piece, the price sounds like a crypto typo: “On Thursday, the electronic currency plummeted to about $50 after hitting a Wednesday high of about $260” — an 80 per cent drop.
Source: Don Pittis | CBC News
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