Bitcoin price surges 10% despite dire predictions about future

One cryptocurrency analyst describes it as a 'Santa rally'

The plummeting price of bitcoin has seen a brief respite over the last 48 hours, with the cryptocurrency rising in value by more than 10 per cent.

The market turnaround comes after nearly a year of declining prices that has seen bitcoin fall from close to $20,000 (£16,000) in December 2017, to today’s price of $3,500.

Other major cryptocurrencies have experienced similar price rallies, including ripple, ethereum and stellar, but by far the biggest gains have been seen by EOS.

The world’s fourth most valuable cryptocurrency has risen in price by almost 50 per cent over the last couple of days, according to CoinMarketCap.

The price gains come as some cryptocurrency analysts were forecasting even more falls in the market. On Monday, one former advocate predicted bitcoin will become worthless in 2019.

Despite such dire predictions, one analyst said the recent rally shows there is still some life in the market.

“The rise in cryptoasset value in the last 24 hours has many questioning if the market is experiencing a Santa Rally. The truth is crypto as a concept is still relatively new and we don’t have enough data yet to show if this is a typical December trend,” Mati Greenspan, a senior market analyst at online trading platform eToro, said in a statement to The Independent.

“What we do know is that the price increase is a strong push off the floor for the market. This type of movement is encouraging and may just end up creating a bottom for this battered market and possibly even a bullish trend into 2019.”

Such a positive spin on this relatively minor market movement is not shared by everyone within the cryptocurrency industry, however, with some saying investors should look towards 2019 rather than hope for any kind of Christmas miracle.

“With the festive break rapidly approaching, those looking for any crumb of comfort from the crypto market or indeed broader macroeconomic news should probably just surrender to over eating, family arguments and endless re-runs early,” said David Thomas, director and co-founder of Mayfair-based cryptocurrency exchange GlobalBlock.

“Along with the ongoing Brexit saga and Donald J Trump show, crypto markets continue to leach value with overall market cap across cryptos now threatening to break down through the $100bn level... Perhaps the only crumb of comfort to take from the whole situation is that a recent study has shown that ID verified crypto users have doubled in the first three quarters of 2018 from 18 to 35 million users, perhaps suggesting that despite the adjustment in price, adoption is slowly picking up.”