Cryptocurrency Crazy – Did I say they were volatile?

When I wrote this article last week looking at the pros and cons of cryptocurrencies, I had no idea of what was about to happen. Here’s a few headlines:

• A bitcoin was valued at $30,511 on Thursday 9th June. One week later, on Thursday 17 June it is worth $17,084. That is a drop in value of 44% in one week!

• Two of the major cryptocurrency exchanges, Coinbase and BlockFi are making thousands of people redundant due to the volatility of the market.

• Binance and many other crypto exchanges are halting both deposits and withdrawals as they run out of liquidity.

While this situation may stabilise in due course, there are likely to be casualties on the way to recovery. Arguably in an oversupplied (over 10,000 active cryptocurrencies) and unregulated market, some consolidation was probably necessary. Unfortunately, the biggest losers in this situation are going to be investors as they will have no recourse to access their money.

On re-reading the article and looking at the Pros and Cons of cryptocurrencies, I think I would now place even greater emphasis on the word volatility!

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