Bitcoins were down to $77.56 as of 3 p.m.Prices reached as high as $266 per Bitcoin around 7:30 a.m.But the price started to fall through the rest of day and Thursday morning.At about 10 a.m.ET Thursday, trading was halted on Mt.Gox, a Japan-based exchange that claims to handle 80% of Bitcoin trade worldwide.The price at that time was already at about $123, down more than 50% from the peak.Mt.Gox issued a statement Friday attributing both the pre-halt price fall and the halt in trading to the rush of new customers trying to trade in the electronic currency."The rather astonishing amount of new accounts opened in the last few days...made a huge impact on the overall system that started to lag," the exchange said."As expected in such situations, people started to panic, started to sell Bitcoin in mass...resulting in an increase of trade that ultimately froze the trade engine."The exchange said the shutdown was different from the cyber attacks that hit it and other Bitcoin sites earlier this month.

During the Mt.Gox trading halt, trading continued on some smaller Bitcoin markets, and the price fell sharply.When trading resumed on Mt.Gox about 10 p.m.ET, the price quickly plunged as low as $69.45, ricocheted back up to $135.69, then started to fall again.All the new volume flooding back to Mt.Gox caused another 2-hour halt in trading.When trading resumed again, Bitcoin prices continued to fall.Since the peak on Wednesday, owners of Bitcoins have lost more than $2 billion combined.Societe Generale currency analyst Sebastien Galy said that even if the bubble has burst for Bitcoins, it doesn't mean it won't have additional rallies in the future."Its trading is typical of a bubble," he said."But there are still people who believe in it.You can't say we're going to zero tomorrow.Even assets that have no underlying value have people willing to trade in it."Galy points out that even the prices Friday were highly inflated from historical valuations.In mid-March a Bitcoin was worth only $47.

He said what's so unusual about the Bitcoin bubble is how quickly it formed and how fast it may now disappear.Bitcoin is a four-year-old digital currency developed by a hacker who still remains anonymous.It's designed to allow worldwide payments with extremely low processing costs.Galy said the wild rise in price moves in recent weeks undermines Bitcoin's original purpose."If their intent was to have a means of exchange, then they failed spectacularly," he said."If we go back to values that are more normal, then the original thought process behind it can take hold again."-- CNNMoney's Hibah Yousuf contributed to this storyResults from the past do not offer guarantees for the future.It’s the legal disclaimer that comes with every new financial brokerage account and trading promotion.And for good reason.Because results from the past, do not offer a guarantee for the future.Then again, history tends to repeat itself.Let’s take a look at the two most recent Bitcoin bubbles: If you superimpose them over each other, a clear pattern emerges: The similarity goes a long way.

The solid line shows the April 2013 bubble, and the transparent line the most recent December 2013 bubble.The x-axis and y-axis are those of April 2013.Only in April and May 2013 the lines diverge, because the April 2013 drop was so much steeper than the December 2013 drop.The reasons for the bubbles are varied though, and they played out at different price levels.In April 2013 the price jumped from $30 to $270 (a 9x increase) and in the December bubble from $140 to $1140 dollar (also 9x increase).litecoin transfer feeA metaphor for the price is that of a skippyball.bitcoin rand valueWhen one throws a skippyball high in the air, the first bounce is big, then lower, and lower, until it is flat on the ground, ready for a new throw upward.bitcoin wallet france

As we now know, that next throw came in November and December 2013: If the 2013 is a good prediction for this year, we are up for some slowly downward (relatively flat) months as the Bitcoin price prepares for the next rise.That rise could reach another 9x increase, leading to $5076.Not quite $10,000 but still worthy.The size of the Bitcoin bubbles are decreasing.The bubble in 2010 went from 0.01 to $1 (x100), and from $1 to $30 (x30).bitcoin trader for coinbaseIn 2011, nothing interesting happened, then in 2012 and 2013 the last two bubbles happened where we saw a 9x price increase.bitcoin kaufen cashThis blogpost has an interesting explanation for the lower bubble size.bitcoin test faucet“As time passes, the investment needed to double or triple or make 10x your money gets much steeper.largest bitcoin wallet

This is the reason why we will never see the types of bubbles as the first two historical bubbles ever again”.We need a reason for a new bubble.A smart commenter reacted on my 10,000 USD price prediction: “Wait, so there will be another Mt.Gox with fake trading accounts pushing the Bitcoin price up 10 fold?“.The Mt Gox trading bots are assumed to be cause of the last bubble.We don’t know what will create the next bubble.ethereum coin contractIt might be a wave of new users.why does bitcoin want math problems solvedGlobal user interest in Bitcoin is still going towards a new low, as shown by Google trends.A new rise in user interest is likely in the make.If you wonder if that Google trends chart matches up with the Bitcoin price chart, here is the answer: In 2013 the user interest and Bitcoin price clearly match up.