Why Bitcoin Tumbled Below 8K

Bitcoin prices briefly slipped below $8,000 each on Thursday for the first time in three months, though the cryptocurrency is still more than double its level at the start of 2019. What do these bold – and volatile – moves mean for the ecosystem?

David Nage, principal at the Los Angeles-based money manager Arca Funds, discusses his views on this week’s price drop and whether price volatility in cryptocurrencies might turn off big investors.

“With bitcoin, where there’s potentially a drop, obviously you can see it as a potential to buy,” said Nage, who saw bitcoin’s price to be artificially bounded until this correction.

Nage believes that as an asset bitcoin is akin to future-pointing equities like Netflix and Amazon. “We’re not in the business of price predictions,” said Nage. “If supply continues to get cut in half and the demand continues to rise, classical economics shows the price increases.”