The price of Bitcoin was only around $992 on January 1st, 2017, having increased by 100% in 2016. Back then, discussions related to the price were not bullish – Bitcoin advocates thought it could reach $2,000 or $3,000 by the end of the year.
Twelve months later, Bitcoin has not only broken records, but caused chaos in the virtual world. Here’s a timeline of how Bitcoin was able to reach such a massive figure, and drop so sharply in a short period of time:
January – The price broke the $1000 barrier on January 2nd. The majority of the Bitcoin trading was taking place in China, so when the Chinese central bank warned investors to think twice before investing in it, the price dropped slightly to $920.
February – Bitcoin was soon back at $1,000, indicating that people were still positive about this virtual currency. But it dropped to $984 when two important Chinese exchanges stopped Bitcoin withdrawals for customers. Banning such activity only increased user interest in Bitcoin. With Philippines allowing Bitcoin as a legal payment method, and the UAE considering the digital currency’s potential, the price started increasing again.
March – Bitcoin was now more valuable than gold at $1,268. But in the same month, the US Securities and Exchange Commission (SEC) rejected two Exchange-Traded Fund (ETF) proposals, one by the famous Winklevoss twins and the other by NYSE Arca. Bitcoin suffered an 18% drop in its price after the first rejection, but managed to make it to April still at four figures.
May – 200,000 computers came under the Ransomeware attack ‘Wannacry’. Hackers forced victims to give them their Bitcoins, ending up with $50,000 worth of BTC. The attack caused a slight drop in price but it placed Bitcoin in the spotlight. It garnered even more attention as Russia’s online retailer Ulmart announced it would start accepting Bitcoins. The price crossed $2,000 for the first time in its history.
June – Things were starting to look good as China’s exchanges lifted the Bitcoin withdrawal ban. Bitcoin’s price continued to increase up to $2,912 before dropping suddenly. This may have happened as a result of the criticism it received from notable figures. Billionaire Mark Cuban called Bitcoin a ‘bubble’, and leading investment bank Morgan Stanley presented research papers which questioned the price hikes in cryptocurrencies, calling them “too volatile”.
July – A Swiss Bank got approval for ‘Bitcoin asset management’, while Morgan Stanley advised people not to buy Bitcoins. However, BTC crashed by 38% in the middle of the month which analysts claimed was a price correction. The price soon recovered to around $2,755.
August – A ‘Hard Fork’ divided the Bitcoin blockchain into two currencies: Bitcoin and Bitcoin Cash. Despite the event, Bitcoin went on to cross $4,000 within two weeks. Australia also came under the spotlight as it announced that it was planning on regulating digital currencies. However, the price fluctuated above and below $4,000, before finally settling at $4,655.
September – China announced that it would ban cryptocurrency exchanges once again, which resulted in the price dropping below $4,000. JPMorgan CEO Jamie Dimon compared it to the tulip mania, and called it a ‘fraud’. Some called it a price correction, while some thought it would suffer for months after China’s ban. But despite speculations and uncertainty, more and more investors grew interested in Bitcoin. Its price managed to stay above $4,000 towards the end of September.
October – Russian President Vladimir Putin took a stand against Bitcoin by stating that it was a ‘risky’ platform for criminals. Another hard fork resulted in Bitcoin Gold, but it only had a small impact on Bitcoin’s price. BTC broke records by crossing $5,000 – it then rose above $6,000 when the largest futures exchange, CME Group Inc., announced that it would launch Bitcoin futures.
November – Starting the month at $6,407, Bitcoin dropped by 15% when the upgrade SegWit2x was called off. Investors started becoming more interested in Bitcoin Cash. However, with Japan legalizing Bitcoin and the upcoming futures contracts in December, the price soared as high as $11,000 on November 29. The new value sent everyone into a panic with more and more people looking for ways to invest in Bitcoins.
December – This entire month proved to be chaotic for Bitcoin. The price initially rose as high as $19,000 in the first week of December, and then dropped to $14,095 within 24 hours. Cboe Global Markets started Bitcoin futures trading on December 10th, which resulted in the price increasing to more than $17,000. Before the CME futures launch on December 17th, the price kept increasing and decreasing randomly. While it settled at $19,783 on the day of the launch, it dropped by 41% to $11,590 on December 22. Analysts claimed it would remain volatile until 2017 came to an end. It moved past $14,000 over Christmas but since then has only increased to $15,265.
What Happens Next?
From calling it the dot-com bubble to claiming that the price would reach $50,000, no one was really sure what would happen at the end of 2017. When the demand reached an all-time high, everyone ran to buy a few Bitcoins for themselves. But when it dropped sharply, people were left confused and worried. Cryptocurrency entrepreneur Julian Hosp stated that this was a welcome ‘dip’ for many analysts since the price was increasing continuously. But this is also a golden opportunity for people to buy more Bitcoins at a lower price. Whether you support this digital currency or not, you have to agree that it took 2017 by storm, and shows no sign of slowing down.
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