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Bitcoin prices have fallen sharply in recent months. After suffering these declines, is the digital ... [+] currency heading for a recovery? Analysts weigh in. (Photo by Chesnot/Getty Images)

Bitcoin prices recently reached a six-month low, having declined more than 50% from their 2019 high of almost $14,000.

After suffering this pullback, has the digital currencys price bottomed out?

While many analysts are unsurprisingly bullish in the long-term, many of them are less optimistic in the short-term, emphasizing that the cryptocurrency could easily suffer further losses.

Market observers offered these predictions after bitcoin fell to nearly $6,500 on November 24th, its lowest since May, before recovering, approaching $7,400 the following day, CoinDesk figures reveal.

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

Bitcoin Overbought, Says Analyst

We dont see $6.5k as the bottom, although its the first strong candidate for that title, said Tim Enneking,managing director ofDigital Capital Management.

While there might be a move up before it happens, we expect bitcoin to drop below $6,000 before this correction is over, he added.

Analyst Marouane Garcon also weighed in, describing bitcoin prices as overbought.

Its nakedly obvious that we cant agree on a true price and its still extremely volatile to current events and even fake news, said Garcon, managing director of crypto-to-crypto derivatives platformAmulet.

I wouldnt be surprised if the price continued to drop.

However, not everyone had the same point of view, as Mati Greenspan, a cryptocurrency analyst who founded the newsletter Quantum Economics, stated that the retracement from the current peak may soon be coming to an end.

In his latest newsletter, Greenspan emphasized the following:

Its now been exactly five months since bitcoin topped out just below $14,000 per coin. Since then volumes have steadily decreased despite the introduction of Bakkt future contracts and Fidelity digital entering the space. Looking at Bitcoin's short history, we can see that the average drawdown is approximately 43% and tends to last 122 days.

Of course, past performance is not an indication of future results but just by the data, it would seem that the worst of this retracement might just be behind us.

The Halving

Several analysts also emphasized the potential impact of bitcoins next halving, which is currently scheduled to take place in May 2020.

When this event takes place, the mining reward, which is currently 12.5 BTC, will be cut in half, falling to 6.25 BTC.

Jeff Dorman, chief investment officer of asset managerArca, spoke to this recently.

While there is no new money coming in to soak up the supply, this supply is about to be cut in half, he noted.

More specifically, the rate at which new bitcoin enters the market will be cut in half, a development that has frequently been considered bullish for the worlds most prominent digital currency.

Bitcoin has rallied quite a bit following past halvings, enjoying notable price gains following the 2012 and 2016 events.

Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.

Excerpt from:
Bitcoin Fell 50% From Its 2019 High. Has It Bottomed Out? - Forbes

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Bitcoin (BTC) prices decline has come as a result of geopolitical and financial factors, a senior investment executive has suggested.

In a tweet on Nov. 25, Gabor Gurbacs, digital asset director at investment management giant VanEck, highlighted several causes which, he says, may have forced Bitcoin to lows of $6,500.

His findings chime with general sentiment over Bitcoin price, which recovered around 11% on Monday to linger around $7,200 at press time.

Like many, Gurbacs accepted that China reportedly cracking down on cryptocurrency exchanges offering services to its nationals had piled pressure on Bitcoin.

Specifically, investors saw the risk and opted to exit the market, hoping to buy back in at lower levels.

I think investors are worried about China crackdown news and hence some second guess their re-entry point and lower prices, he said in another post.

As Cointelegraph reported, an increasingly popular theory around Bitcoin trading activity focuses on tax obligations.

In the United States, investors may be attempting to drive the market lower in order to record small or even negative gains on their holdings for 2019.

Described by Gurbacs as year-end tax-loss arbitrage, it remains uncertain how much participation would be needed to move the market as much as it did in the past week.

According to Gurbacs, who cited data from Skew Markets, liquidity on Bitcoin trading platforms is facing a significant squeeze.

This was also a likely product of concern over Chinas policy, he added, something which has traditionally impacted sentiment.

Bid-offer spreads widest in the past 3 months. Be careful out there. Market can snap fast any direction. Ease into positions. Avoid large/any market orders, Gurbacs advised.

A further price trigger may have come in the form of product development and mergers and acquisitions, he said, with many recent examples funded with cryptocurrency.

More here:
4 Possible Reasons Bitcoin Dropped to $6.5K, According to VanEck Exec - Cointelegraph

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Bitcoin is the emperors new clothes of financial commodities. Its been prancing up and down money street with nothing on for years, despite the fact that lots of thoroughly sensible people have been playing the role of the boy in the fablewho says ere, ees got nuffink on.

Does the fact that the cryptocurrency has endured two major crashes in the space of just three days signal a turning of the tide? The tipping point at which it runs back into the palace in search of a robe accompanied by a hail of stones from its victims?

Ive been waiting for it to happen. It almost always does when people put together a load of old cobblersand tout them as hot investments. Remember collateralised debt obligations or CDOs? They were created by the packaging up of dodgy mortgages that had been mis-sold to poor people, which were given a fancy sounding name so they could be sold around the world to people who should have known better.

Sharing the full story, not just the headlines

When sufficient numbers of them realised that CDOs were wearing the emperors new clothes the result was near global financial meltdown that was only narrowly averted courtesy of great wads of taxpayers cash.

The popping of Bitcoins bubble isnt likely to lead to something quite so dramatic, although therell be a lot of pain. There always is. Youll certainly find it high up on the worry lists of most regulators, who will kept very busy dealing with the aftermath.

On 3 January, 2009, the genesis block of bitcoin appeared. It came less than a year after the pseudonymous creator Satoshi Nakamoto detailed the cryptocurrency in a paper titled 'Bitcoin: A peer-to-Peer Electronic Cash System'

Reuters

On 22 May, 2010, the first ever real-world bitcoin transaction took place. Lazlo Hanyecz bought two pizzas for 10,000 bitcoins the equivalent of $90 million at today's prices

Lazlo Hanyecz

Bitcoin soon gained notoriety for its use on the dark web. The Silk Road marketplace, established in 2011, was the first of hundreds of sites to offer illegal drugs and services in exchange for bitcoin

On 29 October, 2013, the first ever bitcoin ATM was installed in a coffee shop in Vancouver, Canada. The machine allowed people to exchange bitcoins for cash

REUTERS/Dimitris Michalakis

The world's biggest bitcoin exchange, MtGox, filed for bankruptcy in February 2014 after losing almost 750,000 of its customers bitcoins. At the time, this was around 7 per cent of all bitcoins and the market inevitably crashed

Getty Images

In 2015, Australian police raided the home of Craig Wright after the entrepreneur claimed he was Satoshi Nakamoto. He later rescinded the claim

Getty Images

On 1 August, 2017, an unresolvable dispute within the bitcoin community saw the network split. The fork of bitcoin's underlying blockchain technology spawned a new cryptocurrency: Bitcoin cash

REUTERS

Towards the end of 2017, the price of bitcoin surged to almost $20,000. This represented a 1,300 per cent increase from its price at the start of the year

Reuters

On 3 January, 2009, the genesis block of bitcoin appeared. It came less than a year after the pseudonymous creator Satoshi Nakamoto detailed the cryptocurrency in a paper titled 'Bitcoin: A peer-to-Peer Electronic Cash System'

Reuters

On 22 May, 2010, the first ever real-world bitcoin transaction took place. Lazlo Hanyecz bought two pizzas for 10,000 bitcoins the equivalent of $90 million at today's prices

Lazlo Hanyecz

Bitcoin soon gained notoriety for its use on the dark web. The Silk Road marketplace, established in 2011, was the first of hundreds of sites to offer illegal drugs and services in exchange for bitcoin

On 29 October, 2013, the first ever bitcoin ATM was installed in a coffee shop in Vancouver, Canada. The machine allowed people to exchange bitcoins for cash

REUTERS/Dimitris Michalakis

The world's biggest bitcoin exchange, MtGox, filed for bankruptcy in February 2014 after losing almost 750,000 of its customers bitcoins. At the time, this was around 7 per cent of all bitcoins and the market inevitably crashed

Getty Images

In 2015, Australian police raided the home of Craig Wright after the entrepreneur claimed he was Satoshi Nakamoto. He later rescinded the claim

Getty Images

On 1 August, 2017, an unresolvable dispute within the bitcoin community saw the network split. The fork of bitcoin's underlying blockchain technology spawned a new cryptocurrency: Bitcoin cash

REUTERS

Towards the end of 2017, the price of bitcoin surged to almost $20,000. This represented a 1,300 per cent increase from its price at the start of the year

Reuters

The odds strongly favour it blowing up at some point because it always does. These things have been happening since the 17th century when people got wildly over excited by tulips during the Dutch golden age. Economic historians could probably point you in the direction of even earlier instances.

The thing about Bitcoin is there isnt even a bulb to put in the ground from which something pretty should grow.

As my colleague Hamish McRae wrote last year, it fails every test to be considered alongside what we commonly understand as money. Its a highly speculative investment commodity with nothing behind it other than sentiment.

A share is clothed in the earnings stream delivered by the products sold by the issuing company. A real currency is dressed in the prospects of the economy that uses it, and the willingness of a central bank to deploy its reserves to support it.

What is cryptocurrency and the technology behind bitcoin and its rivals?

They thus have a notional floor (although the bottom can still fall out which is why countries and companies go bust).

Bitcoin has nothing. Zip. And yet sentiment is a powerful thing. Already there have been articles aimed at boosting it by taking about how Bitcoins represents a hot buying opportunity now its lost its legs. They have graphs. They have lots of big, clever sounding words that dont mean very much. I saw one accompanied with a tweet talking about its parabolic upward trend. No, really. To those who look at that and say What on Earth?, what it means as that the person who said it is really really clever and should be taken seriously. The emperors new birthday suit is covered in fancy gold braid. Dont you see it? Get online, the hot investment is now affordable! Buy, buy, buy.

I got a giggle from one talking about the improving fundamentals of Bitcoin.

Thats classic finance speak. The word fundamentals usually refers to the prospects forcorporate earnings, or what a central bank might do to boost a currency (such as raising interest rates). There are lots of analysts paid lots of money to write reports and produce graphs based on how stocks, currencies or commodities (like gold, fine wine or frozen concentrated orange juice) might perform based on their fundamentals.

Bitcoin, however, doesnt have any fundamentals other than the fact that some people think it might go up from here because its relatively tightly-held and maybe the big the sellers have all been flushed out.

And you know what? It will go up if the herdputs enough money down.

Its happened before and it will keep happening until it doesnt. At which point it will leave a trail of tears behind it and the worlds regulators will be prodded into writing reports about why they didnt shut the thing down (theyd probably like to if they could find a way to do it) before the punters got hurt. People will get very cross. Fingers will be pointed. But no one will go to jail.

No one will so much as a slap on the wrist. And well all move on to the next one of these.

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Bitcoin has crashed again little wonder as it fails every test to be considered a currency - The Independent

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Fidelity Investments evolution from mutual fund giant donating money to white nationalists to cryptocurrency player with correspondingly less money to donate to white nationalists took another step forward last week. The New York State Department of Financial Services, presumably in between howls of laughter, awarded Fido a crypto license. Obviously, fake money immediately took another nosedive, with bitcoin falling to its lowest level in six months as the Chinese once again took a large needle to the bubble and others recognized the Fidelity news as the contraindicator it is, once again putting John McAfees penis in mortal danger.

Throughout the long boom and (more common) bust cycle of bitcoin, swoons such as these have prompted the inevitable question, is now the time to buy bitcoin? In spite of the obvious answer to that question, we regret to inform you it has been posed again (and not by John McAfee, who certainly hopes so).

Wall Street veteran Peter Brandt, who made a name for himself by predicting bitcoin's devastating 2018 bear market, has called bitcoin's low for July 2020two months after bitcoin's closely-watched halving event. As well as the May bitcoin halving, which will see the number of bitcoin rewarded to miners cut by half from 12.5 bitcoin to 6.25 bitcoin, bitcoin investors are hopeful next year will bring an increase in the number of bitcoin retail investors and people using bitcoin and cryptocurrencies for payments. Bakkt's bitcoin futures daily volume hit a new all-time high, according to data from Intercontinental Exchange, with some $20.3 million across 2,700 futures contracts on Friday.

Bitcoin Has Crashed AgainBut Is This When To Buy Bitcoin? [Forbes]Bitcoin Matches Record Losing Run in Fall to Six-Month Low [Bloomberg]Bitcoin Drops Below $7,000 as China Euphoria Fades [WSJ]Fidelitys crypto company secures New York state license [Reuters]

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Bitcoin Is Cratering Again, Some People Believe For The Last Time, Again - Dealbreaker

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If you are planning to operate a bitcoin ATM business in the U.S. where 60% of the world's bitcoin ATMs are located there's a lot more to consider than simply buying a kiosk from General Bytes, Genesis Coin or Lamassu. You need to stay compliant, both on the federal level and the state level.

However, the cost and the work involved in compliance may be more than some bitcoin ATM operators bargain for, especially if they are only operating one or two kiosks, so it pays to do your homework. What follows is a rundown on the basics, but you may want to set up your business first, according to one lawyer.

"We recommend that you form a corporation or an LLC and have the nuts and bolts of operating as a business down before you start talking about the specifics of bitcoin ATM regulations," Bill Repasky, a lawyer with Frost Brown Todd, a Louisville, Kentucky, law firm that provides legal counsel for bitcoin ATM operators, told ATM Marketplace in an interview.

When you are ready to roll, the federal level of regulations most directly applicable to bitcoin kiosk operators are spelled out in the Bank Secrecy Act, or BSA for short, a law requiring financial institutions to assist U.S. government agencies in detecting and preventing money laundering.

According to theFinancial Crimes Enforcement Network, the government agency tasked with interpreting the BSA, the definition of a financial institutionfits traditional banks, but alsoincludes several subcategories, including one known as a money-services business, or MSB.

A bitcoin ATM operator is considered an MSB, and all MSBs have to register with FinCEN. You won't need a lawyer for this part, said Repasky.It only takes about 20-30 minutes to fill out FinCEN form 107online. Just remember, you have to register within 180 days of establishing an MSB and renew every two years.

Once you register with FinCEN, you are obligated tocomply with the BSA. Among other things, that requires a bitcoin ATM operator to establish an anti-money laundering compliance program, which is a written document that explains your overall plan to thwart money laundering and the financing of terrorist activities.

As part of your AML compliance program, you need to appoint a dedicated AML compliance officer,the principal figure responsible for overseeing the effective development and implementation of you firm's AML program. You also have to maintain superior reporting and record-keeping capabilities to ensure that you are collecting the appropriate information for all transactions and filing the proper reports.

An integral part of any AML program is knowing who your customer is. Know-your-customer is the business process of identifying and verifying the identity of customers, so you can spot risky ones and prevent fraudulent transactions before they start.

In terms of reporting, BSA requires you to monitor customer transactions and file a currency transaction report for any transaction (daily aggregate amount)over $10,000. You also needto file a suspicious activity report for any transaction that might signify money laundering, tax evasion or other criminal activities.

"A suspicious activity could be something in the nature of structuring transactions at a bitcoin ATM that appear designed to evade the $10,000 CTR limit, or It could be a customer providing information that indicates that they are a person of interest to the U.S. government," Repasky explained.

Additionally, the Office of ForeignAssets Control, or OFAC,keeps a database of individuals acting for or on behalf of targeted countries. Included in your AML compliance report, you also need to outline how you are monitoring that list.

Your AML compliance program should also includehow you plan to train and retrain your staff on BSA/AML rules and procedures. Putting together a compliance program is a big job, one that will likely requirehire outside help.

"Typically a bitcoin ATM operator will work with an outside consultant or a lawyer to create the BSA compliance program,"Repasky said."Then they will begin contracting with vendors who can provide the necessary services to comply with the BSA programs, such as collecting information and running it throughthe OFAC list."

FinCEN governs BSA protocol and enforcement. However, various other agencies that are all part of the FinCEN operation have been assigned specific duties for enforcing compliance with the BSA, and for MSBs, the primary investigative authority is the IRS.In fact, the IRS has already made it clear that it is monitoring bitcoin ATM activity and looking into compliance.

"If you're a bitcoin ATM operator and someone is going to randomly select you for an audit, it is most certainly going to be the IRS," Repasky said."What we're seeing now is that the first round of IRS subpoenas have gone out to the bitcoin ATM operators asking for compliance documentation. They went out beginning in the spring and through the summer. They are requesting a boatload of information from the bitcoin ATM operators regarding their BSA programs."

Repasky believes that collecting that informationwill be an eye-opening experience for both bitcoin ATM operators and the IRS. Bitcoin ATM operators simply are not set up the same way as banks. They don't have the same resources, staff and record keeping abilities as large financial institutions, so keeping up with record keeping couldpose a challenge.

"Often the smaller bitcoin ATM operators don't collect it, don't have the capacity to collect it, don't retain it and they will be in trouble, honestly," he said.

In every state that a bitcoin ATM operator conducts business, they need to look at the laws for acquiring a money transmitter license those laws varyfrom jurisdiction to jurisdiction, and are often in flux. Regardless, it's critical to maintain compliance.

"If you run an ATM in a state that requires a license, even if you do everything else correctly, but you don't have that license, it is a punishable, imprisonable federal offense," Repasky warned.

Some states have strict licensing requirements. New York, for instance, requires licensing for virtual currency through its BitLicense, created by the New York State Department of Financial Services. Other states have taken the initiative either through statute or regulatory interpretation to say that the act of transmitting money doesn't affect virtual currencies. And some have a blended program.

In Texas, for example, if you have a bitcoin ATM that is a standalone device, you probably do not need to have a Texas money transmitter license. But if your bitcoin ATM in Texas is connected to a virtual currency exchange then Texas requires a money transfer license.

"If you have to be licensed in your jurisdiction, then you need to look at what is required to be licensed. And that can be onerous from a financial and a compliance standpoint," Repasky said. "In some cases, it is actually the make-or-break decision on whether a bitcoin operator will operate in that state."

Obtainingstate license can take several months.In most cases, you will have to post a surety bond, whichis required so that, in the event the licensed money transmitter stops operating, there ismoney to cover any transactions that have not yet cleared.

The costs of staying compliant can add up quick. "Plan in advance before you drink one too many beers or wines and buy your kiosk and then suddenly, begin to see how much it's going to cost," Repasky said. "It's like what my wife always says about free pets: there's no such thing."

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The ABCs of bitcoin ATM regulation and compliance in the US - ATM Marketplace

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