As Bitcoin Sets Record After Record, Warnings Grow Louder

The cryptocurrency hit $11K for first time Wednesday
By Michael Harthorne,  Newser Staff
Posted Nov 29, 2017 3:44 PM CST
Bitcoin Passes $11K. Then Falls Back to Earth
In this 2014 file photo, Bitcoin logos are displayed at the Inside Bitcoins conference and trade show, in New York.   (AP Photo/Mark Lennihan, File)

What goes up must come down. CNBC reports that bitcoin passed the $11,000 mark for the first time Wednesday just hours after surpassing $10,000 for the first time. Wednesday was the sixth day in a row the cryptocurrency hit a record high, increasing its value 15%, according to Reuters. But later Wednesday, the value of a bitcoin plummeted to as low as $9,300, the AP reports. Regardless, that's still a massive increase over the $1,000 value of a bitcoin at the start of the year. And the CEO of CryptoCompare tells Business Insider the passing of $10,000 was a "seminal moment" for bitcoin. The cryptocurrency market as a whole is now worth more than $330 billion total.

The recent meteoric rise of bitcoin has brought increasing warnings of a bubble set to burst. "Even if you believe in bitcoin, the velocity of the move is a sign that it is parabolic," CNBC's Jim Cramer says. "And parabolic moves don't last." It appears few people are actually using bitcoin as currency, instead stockpiling it in hopes of increasing their capital. “What’s happening right now has nothing to do with bitcoin’s functionality as a currency—this is pure mania that’s taken hold,” research fellow Garrick Hileman tells Reuters. Hileman says "people need to be very careful" about the coming burst. But it appears few are heeding his message. One provider signed up more than 300,000 new bitcoin users over the Thanksgiving holiday. And one analyst predicts the bubble is going to get a lot bigger still—say $40,000 by the end of 2018. (More bitcoin stories.)

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