Bitcoin price drops to five-day low following the creation of Fork Currency

Bitcoin

On Tuesday, the price of bitcoin plunged to a five-day low, despite the fact that maybe the reasons are complex to unpack.

The bitcoin-US dollar BTC/USD exchange rate is at $5,710, more than the daily low of $5,560. According to CoinMarketCap, week on week, BTC increased to 3.3 percent and it’s up 55 percent on a monthly basis.

However, the most likely culprit for the fall is the creation of bitcoin gold on Monday, as per industry observers.

The latest cryptocurrency copied from bitcoin, bitcoin gold currently is at the process of “forking” to a new Blockchain (including new rules), a procedure in which the bitcoin Blockchain is cloned and new digital assets are dispersed to current bitcoin owners.

As stated by analysts containing Blockchain Capital’s Spencer Bogart, an ex-head of research and Needham and Co., the diminished value could be an indication that investors are making the move and investing their money to alternatives now that bitcoin gold is in the forking phase.

Bogart’s justification is that bitcoin rallied ahead of the release in expectation that holders would be credited with bitcoin gold.

Though it is uncertain whether this could be the case as the new cryptocurrency is still to be distributed. Investors may have merely shifted out of bitcoin positions on the reason of further sell pressure before the distribution.

Analysts referring on the price analysis data shows a possible further loss. The decrease from the record highs over $6,100 can be also attributed to overbought technical conditions.

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