UPDATE on Dec 7th, 2013: Looks like the crash started Dec 5th, so I was off by a few days. The lowest I’ve seen has been $666, so it’s still a little off my prediction of $600. There’s still some major selling activity out there and we may still see $600. Bitcoin crashes historically have taken between a few days to 6 months (max) to recover. If you’re speculating on this currency I hope you’re only betting (because it is gambling) money that you can lose and are taking a 18 month view. I’m also morally oblidged to suggest that you actually spend some of your bitcoin on buying stuff to help get the currency off the ground as an actual currency and not just a vehicle for speculation.
Original post from Dec 1st:
Volume has just spiked and the price is about to break below $1000 for Bitcoin on Mt Gox. This is going to be a big crash down to around $600 bucks and it’s going to be fast. It’s already down to $750 on BTC-e but that is generally much cheaper than MtGox due to higher risk (based in Bulgaria & anonymous owner). If you’ve been watching BTC price for a while you’ll recognize this as just another profit taking crash after a big runup. They’ve happened over and over since Bitcoin broke through one buck per coin.
Then, as has happened before, it will climb back up to $1200 and beyond, probably up to somewhere between $4K and $10K before the next big crash. If you do want to speculate on crypto currencies, wait a day or three and you’re about to get a great deal on Bitcoin.
If you’re new to Bitcoin, you’re going to need a strong stomach to ride this one out. Enjoy!
PS: I will add one Caveat. There is a fundamental issue that may be causing some paranoia and that’s the block size approaching 1 MB and miner software incompatibility with block sizes over 1 meg. But it’s something we’ve seen before.