Bitcoin rally ends

This followed a low of just under $5,000 in mid-March, and Bitcoin last hit an all-time high in December 2017 when the price reached $19,783.  

The recent sell-off was triggered by a tweet from Brian Armstrong, CEO of Coinbase, a San Francisco-based cryptoexchange. The tweet concerned rumours that Washington was planning new regulation around digital wallets — a software system used to store cryptoassets such as Bitcoin.  

“We all know that Brian is exceedingly well plugged-in,” says Fred Pye, president and CEO of Toronto-based 3iQ Corp., which manages The Bitcoin Fund. So, that was enough to pull back the price of Bitcoin in the short term. 

Yet, Pye notes that such a drop should also be seen as part of the natural investment cycle of any asset class. 

“I think people have to expect [that] when any asset class runs up as strong as bitcoin has run up in the last three months it’s natural for a consolidation, a pullback,” says Pye. “It’s a perfectly normal retrace.” 

Pye expects the price of Bitcoin to continue to move between $16,000 and $20,000 for the next couple of months, before starting to climb to its next plateau.  

“Next stop is 50 [thousand] probably,” says Pye.  

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