Quote from: mestar on January 20, 2014, 05:55:30 PM

Depends on when we get to the situation where mining difficulty is decreasing. History shows that every time the difficulty decreases for more than 30%, Bitcoin loses about 90% of its value.

Ok, it happened once, from June 2011 to December 2011. But still, you can see it here http://blockchained.com/, 7th chart from the top, titled Bitcoin difficulty vs market price logaritmic, all data.

It's quite logical. Decreasing difficulty means that miners are operating at the edge of zero profitability, and must sell almost all their new coins to cover the cost of electricity. Also, decreasing difficulty dampens the speculators' spirits. No new speculating cash coming in, and miners must sell.

Expect this phase to begin in 3 to 7 months, that is when a long slide down will start. If it loses 90%, it means going down to $100, but since we are at much higher levels now, it could be a bigger slide, it could easily go down to $10 to $50 range.

The difficulty decreased because the speculation shot itself in the foot, not the other way around.