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In cryptocurrency world 10% daily change is considered normal. The markets were extremely volatile in the past and as years pass by they become more stable. We
by paxpelus 9y ago
In cryptocurrency world 10% daily change is considered normal. The markets were extremely volatile in the past and as years pass by they become more stable. We are not there yet but I believe in the future as the market cap increases and more people get involved the price will stabilize more and such changes will be considered a crash.
Also do not forget the people that had money in BTCC exchange. I suppose many of them sold their BTC in order to withdraw there money hence the crash that you see. This price drop in BTCC exchange created arbitrage opportunities and so people (and probably auto-trade bots) started buying cheap BTC in BTCC exchange and then sold to another exchange - resulting in the drop of price that we see right now. Of course panic selling is happening right now too...
Don't forget that 20% changes are not something extreme. Check TSLA price between 23th of June and 6th of July this year. The price went from $383 to $313 which is around 20% change.
- nwah1 9y agoTesla is considered an infamously overvalued stock, and even Elon Musk has publicly questioned the price in the past. It has had the highest number of shorts for any stock. Despite making 1/100th as many cars as the big manufacturers, it has a market cap higher than Ford and GM. That is not exactly a great comparison. A normal blue chip won't fluctuate more than ten percent in a month, let alone in a day. But currencies are supposed to be more stable than stocks. EUR to USD over the past month has wildly swung from 1.17 EUR->USD to 1.19 EUR->USD.
- paxpelus 9y agoI agree with you, Tesla is a volatile and overvalued stock. My point was that such volatility is not unknown even to the US Stock Markets. I don't think a blue chip stock can be compared to bitcoin. It is interesting to see some big movement stock movements that happened in the past. http://www.investopedia.com/articles/stocks/12/most-shocking-stock-increases-falls.asp http://www.investopedia.com/articles/stocks/12/most-shocking...
- dmichulke 9y agoEURCHF begs to disagree ;-) Of course the large move there was caused by politics but the same holds for this BTC drop.
- ringaroundthetx 9y agothe -coin in bitcoin and the -currency in cryptocurrency are misnomers and skeumorphs simply to make an abstract concept more relatable than "transferable cryptographic hash units"
- SimbaOnSteroids 9y agoI believe Tesla's value has everything to do with what people believe Tesla will be worth in the future, simply because confidence in Musk is so high. I think there's this unspoken expectation that Tesla enters the Pantheon of Large Auto Manufacturers.
- nwah1 9y agoFrom a value investing standpoint, it is overvalued, but obviously tech stocks play by different rules. However, even for a tech stock, TSLA is very high priced. I wish them the best, and I truly hope they succeed, but it doesn't change the fact that the speculative value is super high compared to their asset value. That explains why it can swing wildly in price while Ford generally won't.
- SyneRyder 9y agoFor comparison, I checked how CNBC reported the TSLA price fall, to see if it treated it differently. If anything, they were more harsh on Tesla: "Tesla Sinks 20% From High — Entering Bear Market Territory — As Concerns About 'Bubble Stock' Mount" https://www.cnbc.com/2017/07/06/tesla-shares-plunge-12-percent-this-week-on-disappointing-deliveries.html https://www.cnbc.com/2017/07/06/tesla-shares-plunge-12-perce...