Bitcoin price crash: Cryptocurrency market in meltdown as value continues to drop

Ethereum, bitcoin cash and ripple all lose a tenth of their value in less than an hour amid market turmoil

Bitcoin and other major cryptocurrencies are crashing in a sudden and dramatic market collapse.

After weeks of steady gains, bitcoin dropped in price by more than $300 in the space of an hour on Wednesday morning, with ethereum, ripple and bitcoin cash all following its lead. By Thursday morning, bitcoin had fallen $1,000 in just 24 hours.

The reason for the sudden price crash was not immediately obvious, though some analysts have said panic selling could contribute to bitcoin's fall in value.

Other factors potentially contributing to the crash include a report that Goldman Sachs is dropping plans for a cryptocurrency trading desk.

While bitcoin fell by around 12 per cent, the hardest hit by the market shift has been ethereum, ripple, bitcoin cash and EOS, which all dropped by around 20 per cent.

Bitcoin hit a one-month high on Tuesday, leading some experts to suggest that more price gains can be expected.

"The increased price stability of Bitcoin over the last couple of days has not been witnessed for a while and I think it should be viewed as a positive sign with more gains to come, especially in the coming months," blockchain investor and advisor Oliver Isaacs told The Independent when asked about the cryptocurrency's prospects just hours before the crash.

The price of bitcoin plummeted by several hundred dollars on Wednesday morning, triggering a market-wide crash for cryptocurrencies (CoinMarketCap)

However other analysts were quick to say that cryptocurrency investors should be careful about seeing recent gains as a sign of things to come, at least in the short-term.

“Bitcoin’s price might be rising but it’s way too early to call this a true resurgence," said Matthew Newton, a market analyst at the online trading platform eToro. "We’ve seen the price yo-yo for several months so I’d be hesitant to herald this as a new dawn just yet... Traders should be cautious."

He added: "Looking ahead, there is plenty to be positive about though. There’s lots of great fundamental news about the development of cryptocurrencies right now, but that’s going to take time to filter through and impact on price."

Bitcoin is still trading higher than it was at this point last year, though it remains a long way off the highs of December 2017, when its price reached close to $20,000.

Since then, bitcoin has been on a bumpy slide down to today's price of around $7,000, though had experienced a period of relative stability in recent months.

Most significantly, bitcoin has appeared to be more immune to negative press in 2018, which has previously had a major impact on its market movements.