We know Elon Musk is a fan, but what’s all the fuss about, and when will the Bitcoin bubble burst?
Just like the stock market, the cryptocurrency market is frequently subjected to extreme price fluctuations – both upwards and downwards. Tesla recently purchasing $1.5 billion worth of Bitcoin is just one example of how the crypto market can change.
For instance, at the end of 2013 to the beginning of 2014, during the middle of 2017 to the middle of 2018, and now again as we’ve seen in the past few months, there have been many highs and lows of cryptocurrencies.
If we analyze the movement of cryptocurrencies across a 52-week period, it’s clear that the biggest market capitalization is what we’ve seen in the past few weeks:
- Bitcoin (No.1 cryptocurrency by market capitalization) has a 52-week low of US$4106 and a 52-week high of US$58,330 (which are a factor of 14.2 apart)
- Ethereum (No.2 by market capitalization) has a 52-week low of US$95 and a 52-week high of US$2036 (factor of 21.4 apart)
- Cardano (No.3 by market capitalization) has a 52-week low of US$0.01913 and a 52-week high of US$1.48 (factor of 77.4 apart)
(Data source: https://coinmarketcap.com, accessed on March 2, 2021.)
This level of fluctuation within a one-year period is seldom seen in the stock market, and it’s generally not something that’s happening once-off to one specific cryptocurrency; it’s happening often, and to several cryptocurrencies.