Bitcoin price dropped markedly as the news spread about one of the largest digital currency exchanges being hacked.
On Tuesday, Hong Kong-based exchange Bitfinex had to stop trading after discovering a security breach, which included taking its website offline and pausing all withdrawals and deposits. According to the representatives, thousands of bitcoins have been stolen through social media.
Bitcoin prices fell to $541.43 at the time of writing. On Tuesday, the cryptocurrency dropped nearly 20% in comparison with the daily opening price of $607.37 and 27% below the high of $658.28 reached on July 30.
Traders traded over 600,000 BTC via Bitfinex during the 30 days through 2nd August, as Bitcoinity data reveals. This figure represented represented 1.6% of the more than 39m BTC transacted through various exchanges during the 30-day period.
However, it’s not only about Bitfines. Bitcoin prices saw a gradual, downward movement over the course of several days, with market observers pointing to the halving of rewards on the bitcoin network as the cause. This event with 50% reduction in the mining subsidy on the network attracted attention.
Generally, we can see a swing to a bearish trend from previous strong bullish one. The drop below $600 is showing this pretty clearly as previous months and almost entire first half of 2016 were related to a strongly bullish mood.
Going forward, market observers also offered predictions on where bitcoin prices will go next. Now that the digital currency has breached $600, it tests $550, what is Bitcoin low before the Brexit vote.
Tim Enneking, chairmain of cryptocurrency investment manager EAM, interpreted the recent price decline as evidence of a post-halving fallback, further stating that the cryptocurrency will find support above $500.
We will see the next events, as the confidence in the cryptocurrency has to be renewed and there are still strong attributes of Bitcoin which can not be overlooked.
