The cryptocurrency crash was stoked by fears of a ban on trading by South Korea, which sent the markets into freefall on Tuesday.
More than $200billion was wiped off the crypto markets’ market capitalisation as a result on Tuesday.
Bitcoin bottomed out at $9,402.29 (£6,774.26) at 3.39pm on Wednesday, its lowest price since November, according to CoinMarketCap data.
So is boom over for Bitcoin, Ripple and Ethereum?
Jordan Hiscott, chief trader at ayondo markets, said he has “trepidations” about the future of cryptocurrencies unless fundamental questions about the purpose of cryptocurrencies are answered.
He told Express.co.uk: “With at least a 50 percent retracement from the high in December, it does seem that the bubble has burst for some cryptocurrencies.
“My personal view is that it’s problematic to group all cryptocurrencies together as most have vastly different features.
With at least a 50 percent retracement from the high in December, it does seem that the bubble has burst for some cryptocurrencies.
“The speculation element to cryptocurrency trading was a clear driver in pushing up asset values.
“This is why I have some trepidation about the future of the asset class. The questions we have to ask ourselves is: are these genuine alternatives to fiat money for monetary exchange purposes, or are they turbo-charged speculation tools that create vast amounts of wealth?
“I really don’t believe they can be both. For me, the opportunity cost is key – do you want to ‘spend’ your Bitcoins on a genuine monetary transaction if you have the fear that in one year’s time they could be worth three, four or even ten times at much? I would say probably not.”
Mr Hiscott added that he believes Bitcoin to be the “most exposed cryptocurrency” at present due to slower transaction times and its relative expense.
Bitcoin, Ethereum and Ripple have all recovered since the market collapse earlier in the week with Ripple surging in value by 20 percent on Friday to $1.58.
Uncertainty still hangs heavy over the markets with Indonesia being the latest South-east Asian country to outlaw cryptocurrency trading.
Dennis de John, managing director of global trading site UFX, said the prospect of regulation from China and South Korea posed a real threat to the industry’s future.
He said: “It’s certainly a huge concern. Especially in South Korea, known for their hard-line stance on speculative investments.
Cryptocurrencies crash: Which cryptocurrencies should you invest in now?
“Their government is posturing to crack down on the very exchanges and traders that initially seemed responsible for the stratospheric rise of Ripple, Bitcoin and Ethereum, certainly driving South Korea’s local prices well above the global norm.”
He went on to add that if cryptocurrencies can’t get governments on board, “their brand will be tarnished”, discouraging everyday investors such as “mum, dad and gran” from joining the movement.
Earlier this week, Mr de John said the crash had been a result of a “price adjustment” that experts had recently been warning investors about.
He said: “Despite this blip, it’s still too early to suggest the bubble has completely burst, and this could be the ‘price adjustment’ that market experts had warned of lately.
Cryptocurrency crash: Proposed regulation by South Korea has caused concern for crypto investors
“The majority of those experts maintain that market volatility is to be expected, so don’t be surprised to see a resurgence in Bitcoin in the coming weeks – it’s unlikely that there will be any large-scale panic departures from the market just yet.”
The financial advisor said speculators must look beyond short-term rises and falls and cited Amazon as one example of being a company that took ten years to become a trusted household name.
A quarterly market report on XRP which will be released next week is set to be a good indication of whether institutions are using the Ripple currency or not, he said.
However, Luxembourg’s Finance Minister Pierre Gramegna remained buoyant about the prospect of cryptocurrencies despite suggestions that the EU would follow Asia by introducing regulation.
Speaking to Bloomberg on Monday, he said: “Virtual currencies are there to stay. They bring added services, they are convenient, they are more simple and so consumers love them.
“I think the regulators and the countries will have to monitor it and to regulate it to a certain extent. Certainly, more than it’s the case now.”