Over the weekend Bitcoin passed the 1 year anniversary of its now famous top. At the end of November last year it crossed $1,240 and surpassed the price of one ounce of gold. There were countless projections during those frenetic November weeks about how Bitcoin would soon push toward $1 million.
I wrote an article that day titled Bitcoin Pushes To $1,240 Taking A Ride Out To The South Seas. I put up this chart showing the correlation between Bitcoin's rise and the famous South Sea Bubble during the early 1700's.
One year later Bitcoin has collapsed down to $380, and almost no one talks about it anymore. To be honest, I'm surprised it is still that high. I would have preferred to purchase one ounce of gold when it was equal to Bitcoin at $1,240, but gold has also performed poorly over the last year, sitting at $1,200 as of this writing.
Investors have found a new found love in paper currency during 2014, specifically the U.S. dollar. My guess is that over the next five years one of the major paper currencies (perhaps the Japanese yen?) will experience the same time of plunge Bitcoin has endured over the last 12 months.