Bitcoin, cryptocurrency, and online trading

Bitcoin, the first cryptocurrency by date of launch and by market cap (as of December2017) has attracted investors and traders because of its ease of starting trading, ability to stay pseudo-anonymous, and, of course, dramatic growth during its history (see Table 1 and Figure 1 for some statistics). This lures long-term investors; its high volatility also attracts day traders.

However, it's hard predict the value of Bitcoin in the long term, as the value behind Bitcoin is less tangible. The price mostly reflects market perception and is highly dependent on news, regulations, collaboration of governments and banks, technical issues of the platform (such as transactions fee and block size), interest of institutional investors in including Bitcoin into their portfolio, and more:

Figure 1: Bitcoin and its dramatic price increases

Nonetheless, from a short-term perspective, Bitcoin price is a by-product of market activity usually happening on a platform...