Skip to main content

Bitcoin approaches $20K, but is the bubble about to burst?

bitcoin stock
Vyacheslav Prokofyev/TASS/Getty Images
Bitcoin is currently the largest and most valuable cryptocurrency on the market. According to Coindesk, it is valued at little over $19,000 for a single coin. However, despite the coin’s meteoric rise in recent months, there are some concerns that the cryptocurrency is a bubble waiting to burst. These concerns have grown especially pronounced as the coin approaches the milestone price of $20,000.

These concerns aren’t completely unfounded, as Bitcoin has crashed a few times in the past. According to Dr. Daniele Bianchi, of Warwick Business School, those crashes were due to increased competition from other cryptocurrencies, government intervention, and technological issues.

“This tells one simple story; the main risk for Bitcoin comes from external factors such as regulatory intervention and security breaches which might hit the credibility of the entire protocol and its effective usefulness as a method of payment/store of value,” Bianchi told Forbes.

In terms of competition, Bitcoin has plenty, but so far, the currency has managed to maintain its lead due to the fact that it was one of the first to hit the market. In terms of price per coin, Bitcoin Cash is the second most valuable cryptocurrency at $1,861, though it lags behind both Bitcoin and Etherum in terms of market cap.

The recent move by investment firms to set up Bitcoin futures markets have had a mixed effect upon the cryptocurrency. On one hand, the investments are likely one of the reasons the coin’s value has continued to rise over the past month. If we do see Bitcoin break the $20,000 mark before Christmas, it will likely at least partially be thanks to those investors.

On the other hand, the increased interest from major investment firms means that we’ll likely see various government agencies taking a closer look at the currency and possibly implementing stricter regulations. Right now, the U.S. government has largely taken a hands-off approach to the coin, but if it continues to grow in value and attracts the attention of Wall Street, it’s unlikely that the federal government will sit idly by.

As for the alleged Bitcoin bubble, it remains to be seen what the future holds, though as with many investments, there is potential for a great payoff alongside some pretty high risks.

Eric Brackett
Former Digital Trends Contributor
How Coinbase stopped the Twitter Bitcoin hack from being even worse
twitter and laptop hacked

The hackers behind last week's massive Twitter security breach made off with more than $100,000 through their Bitcoin giveaway scam. But it could have been much worse.

Quick responses from Twitter and Bitcoin exchanges like Coinbase reportedly kept a combined $300,000 away from the hackers' pockets.

Read more
FBI moves in to investigate Twitter’s massive Bitcoin hack
Twitter symbol photo. Credits: Twitter official.

The Federal Bureau of Investigation (FBI) is now examining the major hack that hit Twitter on Wednesday, July 17, in a bid to find out who was behind the incident, the Wall Street Journal reports

Twitter accounts belonging to Barack Obama, Joe Biden, Bill Gates, Elon Musk, and Jeff Bezos, among other high-profile users of the microblogging service, were hit in a scam that involved a fake tweet encouraging followers to send payments to a Bitcoin wallet. It had some success, too, as data on Blockchain.com showed that more than $115,000 via 392 transactions was sent to the Bitcoin wallet posted in the messages.

Read more
Dozens of major Twitter accounts hacked in massive Bitcoin scam
Twitter Bitcoin

Update: Late Wednesday night, Twitter revealed what it knows so far about the hack that targeted dozens of high-profile accounts on its service -- and it isn't much.

Dozens of high-profile Twitter accounts were seemingly hacked in a massive Bitcoin scam on Wednesday afternoon, with each account tweeting out messages offering anyone thousands of dollars worth of cryptocurrency. After more than an hour, the social network disabled tweeting from verified accounts in order to stop the message from spreading.

Read more