Bitcoin Drops 12% to below $5,000

Bitcoin Drops 12% to below $5,000

The world’s largest cryptocurrency dropped to its lowest level in more than a year on Monday.

Bitcoin hit a low of $4,883.09, bringing its losses to more than 22 percent in the past seven days and more than 65 percent this year, according to data from CoinDesk.

The digital currency began stumbling last week after months of relative calm. Bitcoin had been trading in the $6,400 range for the majority of October, a break from its volatility earlier this year, as the rest of global markets sold off. The cryptocurrency is now down more than 30 percent since last Thanksgiving.

Its epic rise started right after the American holiday last year, as the cryptocurrency gained its status as a household name and became a common topic around dinner tables. Bitcoin first topped $10,000 at the end of November last year and was worth almost $20,000 ahead of Christmas, mostly driven by retail investors.

The rapid runup also coincided with the introduction of a bitcoin futures market in December. Peak prices lined up with the day the Chicago Mercantile Exchange, or CME, introduced bitcoin futures trading on Dec. 17. The Chicago Board Options Exchange, or CBOE, opened a futures market a week earlier. Until futures existed it was extremely difficult, if not impossible, to bet on the decline of bitcoin prices.

On Monday, both of those bitcoin futures hit their lowest level since they were introduced. Bitcoin CME futures fell as low as $5,015, while bitcoin contracts on the CBOE dropped to $4,990.