Bitcoin falls suddenly puts it in bear market territory

Bitcoin has yet to redefine the global payments system. But it could raise questions about how to define a bear market.

Stock strategists — and financial journalists — typically use a 20 per cent tumble from a high as the trigger for calling a bear market. Bitcoin at one point on Wednesday met that description, according to Bloomberg’s composite price. The low for the day was 20 per cent below the record, set way back on Monday.

It marks the first time for bitcoin to slide into bear-market territory since last month. There have now been three bear-market dips for bitcoin just since August. By contrast, the S&P 500 Index of stocks last saw a bear market in 2009. When Wells Fargo, the American bank with a market capitalisation roughly the size of bitcoin, last saw a bear market for its shares the drop took more than a year to materialise — from July 2015 to October 2016. The latest bitcoin slide comes amid a whirlwind of news in crypto-land.