Bitcoin: What Was Behind This Wild Week?

Prices for the world’s top digital currency fluctuated violently over the past week. Bitcoin managed to achieve a record high in its price of over $62,000 U.S. in the middle of April. However, it fell below $50,000 U.S. early this week. Rumours have swirled around bitcoin and the broader crypto market.

The first bit of bad news that disrupted the crypto market was a technical mishap. The weekend of April 18-19 saw a major power outage in China’s Xinjiang region. Many experts speculated that this triggered a selloff for the top cryptocurrency. BitInfoCharts stated that the network’s security saw a sudden decrease from its April 15 value of 157 exahashes per second to just 105 exahashes per second. That represents a 33% plunge.

Beyond the technical burp, crypto bulls are also uneasy about a potential regulatory crackdown. U.S. Treasury Secretary Janet Yellen recently called bitcoin "extremely inefficient." There are also concerns that bitcoin investors will start to see a major push from tax collectors in their respective countries.

This aside, digital currencies have ridden a strong wave into the mainstream over the past year. Bitcoin has been embraced by huge platforms like PayPal (NASDAQ:PYPL). Morgan Stanley (NYSE:MS) recently started to offer bitcoin trading to high net worth clients. JPMorgan (NYSE:JPM) has also stepped into the fray and recent reports suggest that the bank is exploring a bitcoin-focused fund.

Rumours can be revealing, but the crypto market has chalked up many more wins than losses over the past year. Bitcoin may still have room to run in a market overflowing with liquidity.