Bitcoin rebounds after curbs in South Korea trigger 8% slump
Concerns voiced over speculative bubble as cryptocurrency value rises 1,500% in a year
Bitcoin’s soaring value has led to concerns there is a ’speculative bubble’ in the cryptocurrency. Photograph: Sascha Steinbach/EPA
Bitcoin appeared to find a bottom on Friday, rebounding to $14,000 after moves by South Korea to curb speculation and protect retail customers took the cryptocurrency down more than 8 per cent yesterday.
Bitcoin climbed as much as 8.3 percent in Asian trading, before dropping back to trade 1.9 percent higher at $14,211 at 8.21am in New York, composite Bloomberg pricing showed. The digital currency has slumped about 27 per cent from its record $19,511 reached on December 18th, when the CME Group introduced its futures contract. While bitcoin’s debut on regulated derivatives exchanges in Chicago was thought to have given it a new mainstream channel for investors to tap, so far trading volume has been limited.
“Short-term support is about $13,500 - we’ve hit that the last couple of trading sessions,” Chris Gersch, director of strategy at Bell Curve Capital LP in Chicago, said on Bloomberg Television. “Ultimately I think it moves lower and tests last week’s lows around $12,400 in the futures contract,” he said, referring to the CME’s version.
The South Korean government has been among the loudest voices of concern about a possible speculative bubble in the largest cryptocurrency, which is still up about 1,500 per cent for the year. The country is something of a bellwether for global demand, with South Koreans paying premiums about 20 per cent over prevailing international rates as of Friday.