How much is the bitcoin worth

Bitcoin: Expert discusses recent drop in cryptocurrency value

Bitcoin's price has reassuringly steadied noticeably since the start of the working week. Marcus Swanepoel, CEO of cryptocurrency exchange Luno, believes last week’s dramatic events are simply something to be expected from time to time.

He told Express.co.uk: "We've already seen bitcoin rise again after the recent price correction, indicating the sell-off was likely a result of traders selling and profiting on the recent increase.

Like any asset, bitcoin will always have ebbs and flows

Luno CEO Marcus Swanepoel

“Like any asset, bitcoin will always have ebbs and flows, but the multiple record-breaking highs it's achieved in the last few weeks only point toward a positive and upward trajectory."

BitfinexCTO Paolo Ardoino is also among experts who remain bullish about BTC's propects.

He told Express.co.uk: “Turbulent cryptocurrency markets have left traders guessing at what the next price move will be.

“Bitcoin’s every move is now being carefully watched by a growing audience of institutional investors still trying to grapple with the possibilities of an asset that only a decade earlier was the preserve of a small band of technologists.

"As bitcoin captivates, the future gets brighter still for all those holding the new digital gold.”

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The flagship cryptocurrency is currently trading at $35,526 (£26,041), as of 6.30pm GMT, CoinDesk.com data indicates.

Trade in the cryptosphere had hit record levels in the past five months.

Bitcoin blazed a trail, rapidly-rising by 230 percent in that period alone.

This witnessed BTC reaching a record value of more than $41,000 (£30,050) on Saturday, January 8.

And co-called altcoins, such as ethereum, gained 217 percent, prompting a number of prominent investors to warn about the dangers of speculative bubbles.

However, cryptocurrency traders are at pains to point out how bitcoin remains a full 95 percent above where BTC was even a month ago.

Technical charts reveal this week's latest price retracement has brought a number of support levels into play.

This refers to the level at which the BTC price should sustain, even in the face of a more aggressive sell-off.

Bitcoin’s occasionally-violent volatility means the flagship crypto is a challenge to value for two interlinked reasons.

A major challenge associated with digital currencies such as bitcoin is its reflexivity.

BTC is a currency, meaning its popularity, or demand is crucial in determining its value.

This is considered a major challenge for bitcoin, as recent history proves how this can result in upward or downward price spirals.

Despite stocks' emotional association with their trading swings, their fundamental value stems from assets and cash flows - something bitcoin does not offer.

The Lindy Effect is another helpful way of appreciating bitcoin’s value, in that it concerns confidence in the crypto.

The longer bitcoin lasts without attracting controversy, confidence in bitcoin will likely grow.

As with reflexivity, this suggests why volatility is high with bitcoin because if BTC is surging it is a reason for optimism, while it plunged, this is a reason for pessimism.