Last week, when Bitcoin’s price hit a new high of $1,240, Bloomberg News compared it to a massive bubble. Then over the weekend, on the news that China’s central banks would be banning Bitcoin, the price fell nearly 50 percent down to $680 apiece. It was the latest in a roller-coaster ride of Bitcoin booms and busts. But the truth is that the wild swings in price Bitcoin has been experiencing are a natural reaction to the massive global interest in a pool of money that is relatively tiny compared to its government-backed peers. And it’s preventing Bitcoin from achieving its real purpose as an innovative new form of currency.
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