It’s been another bad week for Bitcoin investors: Amid new regulatory concerns, the cryptocurrency’s value dropped to a one-month low of $8,371 early on Friday.
Bitcoin has since rebounded to nearly $9,000, according to the crypto-tracking site CoinDesk, but it is still down significantly from last week’s high of $11,650. And Bitcoin is down more than 50% compared to the all-time high of nearly $20,000 reached in December 2017.
Bitcoin and all cryptocurrencies have demonstrated just how volatile they can be throughout early 2018. One month ago, amid the larger selloff in the stock market, Bitcoin plunged below $6,000, down 70% off its all-time high. The values of other cryptocurrencies like Ethereum, Ripple, and Litecoin decreased more than 25% in a single day as well. Bitcoin soon popped up 50% and has flirted with $12,000 over the past few weeks, before dropping again in recent days.
It’s always hard to explain how and why the cryptocurrency market rises and falls. The Nobel Prize-winning Yale economist Rober Shiller has said that Bitcoin “has no value at all unless there is some common consensus that it has value,” and that cryptocurrencies “might totally collapse and be forgotten.”
Lately, investors could be scared off by the prospects of the IRS cracking down on crypto traders—who may owe significant taxes on their profits—and new regulations announced this week by the Securities and Exchange Commission (SEC). The value of Bitcoin promptly dropped around 10% in one 24-hour period this week soon after the SEC said it would require digital asset exchanges to register with the agency, CNBC reported.