Bitcoin off record highs, slumps 7% in volatile trade

FILE PHOTO: Representations of virtual currency Bitcoin are placed on U.S. Dollar banknotes in this illustration taken May 26, 2020. REUTERS/Dado Ruvic/Illustration

LONDON (Reuters) – Bitcoin fell as much as 7% against the dollar on Tuesday as the fledgling currency was back to its volatile self after having scaled a record peak earlier in the day.

The world’s most popular cryptocurrency was last down 6% at $18,500 as of 1241 GMT. The price drop in bitcoin, which some investors saw as an evolving safe-haven, coincided with spot gold’s 1.6% rise.

Smaller coins ethereum and XRP, which often move in tandem with bitcoin, fell 7.3% and 8.8%, respectively.

Bitcoin has gained 160% this year, fuelled by demand for riskier assets amid unprecedented fiscal and monetary stimulus, hunger for assets perceived as resistant to inflation, and expectations that cryptocurrencies will win mainstream acceptance.

Bitcoin’s 12-year history has been peppered with steep gains and equally sharp drops. Compared to traditional assets, its market is highly opaque.

Graphic: Bitcoin hits record high –

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