Bitcoin plunged nearly 20% less than a week after reaching a new high as automatic sell orders kicked in, deepening the downturn and underscoring the cryptocurrency’s volatility. Sunday’s “flash crash,” similar to wild computer-driven swings in the stock market, did no lasting harm, and Bitcoin ‘s price quickly made up some of the loss. “A power outage in the Xinjiang region of China where a significant portion of Bitcoin mining takes place caused a very sudden dip in the global hashrate which, in turn, caused transactions to back up and fees to rocket temporarily,” Jason Deane, Bitcoin analyst at Quantum Economics, London, told Newsweek . “Weaker hands interpreted this to be a major problem for the network and off-loaded their Bitcoin in quantities just sufficient enough to trigger a chain reaction of liquidations via automatic executions of stop loss (orders), thereby driving down the price very quickly,” he said. Bitcoin mining computer servers are seen in Bitminer Factory in Florence, Italy. Truby recommends taxing the purchase of bitcoin mining machines. ALESSANDRO BIANCHI/REUTERS A “hash” is an alphanumeric code of a set length used in Bitcoin mining, or solving complex problems with computers. If successful, the miner earns a predetermined number… Read full this story
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