Bitcoin, which climbed from less than one dollar in 2009 to as high as $20,000 in 2017, has plunged below $13,000 just in five days. According to financial experts, Bitcoin is a new international currency which works without a central bank or single administrator. The system works peer-to-peer in which transactions take place directly between users without any intermediary. Transactions are verified by a network of nodes and are recorded in a ledger known as blockchain. The origin of Bitcoin is shrouded in mystery as the currency was invented by unidentified group of people under the name Satoshi Nakamoto and was released as open-source software in 2009. The digital currency was going up at a fast speed to experience a twentyfold increase since the start of the current year, climbing up to $20,000. Many countries, including Pakistan, have yet to make laws to regulate or operate the digital currency within their geographical boundaries. As the shabby currency had been disproportionally taking over the attention of the world financial managers, the last week was the worst week of its performance. The bubble has just burst.
Bitcoin has been falling with increased losses for new entrants in the digital currency market since less than a week. The future is unpredictable as it is appearing as big threat to world’s strongest currencies – dollar – as well as British pound and euro. According to an expert of the world currencies, a manic upward swing could be followed by a downturn with the change of sentiment. When value of a script goes out of proportion, the traders start waiting for a correction. Some believe the traders will say goodbye to cryptocurrency this year. The profit taking move by the traders is looming large at the world stock exchanges.
According to Coinbase, a US-based company which provides digital wallets for storing bitcoin, it will investigate the sharp rise and fall of the currency in short span of time. Some European bankers have started calling it a deadly gamble and warn about the risks of at volatile and unregulated market. When a script starts falling, everyone is ready to offload the burden and this is happening to the digital currency. The fall of bitcoin value is a lesson for the actual and potential Pakistani traders that all that glitters is not gold.
