2015 has not been kind to bitcoin thus far. The cryptocurrency, which has endured a stiff price decline since its late-2013 heights, is back below the $300 mark. Bitcoin’s total transaction volume, as measured by Blockchain.info, has also slipped in recent days.
Theories abound about why its price has slumped, but there seems to be a lack of consensus in bitcoin’s enthusiast community as to what is going on. Certainly, the decline in trading volume — which also shows up in Coinbase data — could indicate a fall in short-term, buy-side interest in bitcoin, though why that would occur at the start of a new annum isn’t immediately clear.
Here are the charts, starting with price:
And now volume:
Naturally, the bitcoin bulls are still out in force.
The price of bitcoin doesn’t matter too much in the short term, though for the larger mining installations it certainly can. But to see a rapid decline in volume is surprising. The larger narrative of 2014 for bitcoin was that while its dollar price bounced about, total volume increased. That indicator was considered its material pulse — so long as more total transactions were being executed, bitcoin as a concept was not broken.
Now, however, with both watched indicators in the tank, fans of the digital means of wealth transfer will have to ask themselves if this is the moment to double down or not.