Bitcoin has fallen below US$2 000 for the first time since May amid anxiety its dominant status is under threat.
As enthusiasts consider adopting competing updates to the blockchain technology that underpins the exchange method by the end of July, it has raised the possibility of the cryptocurrency splitting in two. Bitcoin has lost about a third of its value since peaking at about $3 000 last month. Calls for a revamp of the software come as exchanges struggled to keep up with rising volumes while the price almost tripled this year.
Bitcoin isn’t the only one struggling as the two competing camps — miners and developers — are facing off over how to deal with increasing transaction times and processing fees. The 30 largest cryptocurrencies have all suffered declines over the past seven days, according to data from coinmarketcap.com. Bitcoin has lost about 20% of its market value, while the second-biggest digital coin — ethereum — has lost 30%.
Cryptocurrency exchange GDAX said it anticipates temporarily suspending bitcoin deposits and withdrawals after the 1 August software update deadline, and may also pause trading.
“In either scenario, we will implement safeguards to ensure the safety of our customers’ funds,” the exchange said in a 13 July post on its website. “This decision will be based on our assessment of the technical risks posed by the fork, such as replay attacks and other factors that could create network instability.”
Bitcoin fell as much as 14% to $1 852.19 in New York, its lowest intraday level on a weekday since 18 May. Ethereum has plunged by more than half since its June peak, according to prices compiled by coinmarketcap.com. — Reported by Cecile Gutscher and Lily Katz, (c) 2017 Bloomberg LP