After big gains, Bitcoin dives 20% in 10 hours

LONDON/TOKYO: Bitcoin lost almost a fifth of its value in 10 hours on Friday, having surged more than 40% in the preceding 48 hours, sparking fears the market may be heading for a price collapse.
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In a hectic day on Thursday, Bitcoin leapt from below $16,000 to $19,500 in less than an hour on the US-based GDAX, one of the biggest exchanges globally, while it was still changing hands at about $15,900 on the Luxembourg-based Bitstamp.
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Having then climbed to $16,666 on Bitstamp at around 0200GMT on Friday, it tumbled to $13,482 by around 1200 GMT—aslide of more than 19%.
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As of 1320 GMT it had recovered to around $14,400, stilldown 13% on the day. "This correction is an appropriate one after such frenziedtrading," said
Nigel Green , founder and chief executive offinancial consultancy de-Vere Group , in a note to clients. "We should expect to see bitcoin see-sawing in coming weeks."
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"Today's digital world needs cryptocurrencies. One or two of the existing ones will succeed. Whether it's bitcoin or not remains to be seen," he added.
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As Bitcoin slumped, other cryptocurrencies climbed. Ethereum, the second-biggest, was up almost 6% by 1320 GMT, according to trade website Coin marketcap.
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For the week, bitcoin was still up almost a third. Since the start of October, bitcoin has more than tripled in price—its strongest quarterly performance since 2013.
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And since the start of the year, it has increased by about15 times in value— a rise that led to growing concerns the bubble would burst in dramatic fashion.
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The rise has drawn in millions of new investors. So far thisweek, more than half a million new users have opened walletswith retail-focused bitcoin wallet provider Blockchain, the firmsaid, doubling the total number of users to 20 million sincelast year.
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Some market-watchers say the most recent lurch higher inbitcoin can be explained by the coming launch of bitcoin futureson major derivatives exchanges. The Chicagobased Cboe GlobalMarkets exchange will launch a futures contract on Sunday, to befollowed by CME Group and Nasdaq.