Bitcoin has taken the market by storm this year, and despite hitting a record high on December 10, the digital currency has still had quite a volatile month. As a result, there are a number of investors who have come forward and expressed their doubts that the crypto market will be able to handle certain fluctuations in both price and demand.
Some fans of Bitcoin might be in denial that their virtual currency is struggling at the moment, but it is crucial to keep in mind that, regardless of how much you enjoy the crypto sector, Bitcoin has dropped more than 5% over the course of the last 24 hours and on Tuesday the currency dropped even more. It’s not just me who thinks investors should keep this in the back of their minds either; Bitcoin.com co-founder Emil Oldenburg recently stated that investing in the digital currency is one of the riskiest investment choices an individual can make right now as it is “extremely high-risk”.
It’s not as simple as just staying away from the currency while it’s in a slump either, the significant fall in value is starting to affect various companies – regardless of whether or not these companies have had a successful month themselves.
On Thursday, in morning trade, shares of a number of Bitcoin-related stocks plunged. Perhaps the most notable drop of the day was the decline that both Riot Blockchain (NASDAQ:RIOT) and Bitcoin Investment Trust (OTCMKTS:GBTC) experienced. As of this writing, Riot Blockchain Inc. shares are down almost 18.05%, while Bitcoin Trust shares are down 17.12%. When looking at the stocks, you can see that both are constantly changing, going up and down a few cents, but declining for the most part – and I don’t see it making a turnaround.
This isn’t the first time these two companies have made headlines this week, however. On Monday, Citron Research short-seller Andrew Left announced to his followers on Twitter (NYSE:TWTR) that he will be shorting Riot Blockchain, which is a company that only recently added the word “blockchain” to its name two months ago – a decision that immediately caused the company’s shares to soar.
Further, Riot Blockchain, which is based in Castle Rock, Colorado, announced on Tuesday that it had raised a total of $37 million in gross proceeds solely from subscription agreements. According to Riot, these proceeds will be used to develop bitcoin mining.
It will be interesting to see whether or not the slump Bitcoin is experiencing right now will continue into the new year.
Featured Image: twitter