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Bitcoin Bears Say Told You So

Bitcoin Bears Say Told You So Bloomberg


If you think oil had a rough 2014, consider bitcoin. The digital currency has plunged 54 percent since the beginning of the year. By contrast, Brent crude has fallen 44 percent; the ruble is off some 46 percent against the dollar.

Bitcoin’s collapse comes as governments around the world consider regulating or prohibiting the virtual currency to prevent criminals from using it to trade contraband. Meanwhile, bitcoin is facing competition from a slew of rivals striving to be more palatable to regulators.

The dramatic reversal -- bitcoin reached more than $1,100 in 2013 and is now trading at about $350 -- is prompting told-you-sos from skeptics who long said the currency’s promise was overhyped.

“I don’t know that it’s on its last legs, but it’s not looking good,” said Nathalie Reinelt, an analyst at financial consulting firm Aite Group, who has written reports expressing doubts that bitcoin will become a mainstream currency. “It’s not in a healthy state.”

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The simple fact that we don't know if Bitcoin will be at $100 or $1000 in a year is exactly the reason to be fearful about its use as a currency and/or investment.

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