There might be trouble brewing for cryptocurrency investors as popular digital currencies have cratered across the board this week. For example the Ethereum price has fallen 13% overnight and 16% over the last week.
While still the most popular cryptocurrency by far in Bitcoin lost 11% of its value overnight to sell for US$5,867 (A$8,075) as at 11.35am AEST.
The falls in Bitcoin are mirroring the falls in more traditional investment markets, with the likes of Australia’s benchmark equity index the S&P /ASX200 (ASX: XJO) down close to 12% since its recent peak at the start of September.
The Bitcoin price falls are also sending its spin-off in Bitcoin Cash even lower, with it now down a shocking 17% in 24 hours and more than 27% over the last week.
On Thursday morning, Bitcoin cash is selling for US$449 (A$618) according to Investing.com, with the price weakness potentially caused by several different factors.
Analysts and commentators are largely attributing the big falls in cryptocurrencies to the upcoming ‘hard fork’ in Bitcoin Cash.
Bitcoin Cash itself was created in August 2017 after a ‘fork’ or spin off from the original Bitcoin currency itself.
The cash version itself was adopted to speed up transaction processing times as the currencies became incredibly popular over 2017.
Now Bitcoin Cash itself is set to “fork” into a new distributed ledger and trade administration platform which apparently could lead to the creation of a new coin, which is also a derivative of the original Bitcoin.
Overall, it’s the confusion and opaqueness surrounding the cryptocurrency world that is probably hurting sentiment especially just prior to another ‘fork’ that will split the original blockchain ledger further and create more uncertainty for digital currency believers.
Whether or not you believe in the future of digital currencies, one thing for certain is that they won’t pay you any dividend income as they don’t earn any cash themselves.
Unsurprisingly, in Australia many investors prefer the certainty of dividend shares like Commonwealth Bank of Australia (ASX: CBA), over the likes of Bitcoin cash.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
Motley Fool contributor Yulia Mosaleva owns shares of Commonwealth Bank of Australia. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
- Why these 4 shares are being heavily shorted – December 11, 2018 3:23pm
- S&P/ASX 200 at 2-year low: Here are 6 popular shares getting crushed today – December 10, 2018 4:33pm
- The ANZ Bank share price nears 52-week low as analyst flags $3.3 billion buyback potential – December 10, 2018 3:10pm