- Tram Ho
Bitcoin continued to decline during trading on Feb. 23 after US Treasury Secretary Janet Yellen and Tesla CEO Elon Musk both made negative statements with its price. Down 11% within 24 hours, Bitcoin has plummeted below $ 50,000. During the worst times, Bitcoin lost 16% of its value, hitting the bottom of the day at $ 45,041 per coin.
With the collapse of Bitcoin, smaller market cap currencies like Ether and XRP also fell. Ether is down 11% to $ 1,573 while XRP is down 17% to 47 cents / coin.
One day ago, US Treasury Secretary Janet Yellen called it “an ineffective way of trading” and warned of it being used in illegal activities. Ms. Yellen also rang alarm bells about its impact on the environment. In addition, the volatility of digital currencies has prompted some critics to reiterate their plans for state-issued and managed digital currencies.
In fact, Bitcoin is not controlled by any central bank. People called miners use high-powered machines to solve complex puzzles to execute a transaction. According to an online tool from researchers at Cambridge University, the Bitcoin network consumes more electricity than Pakistan.
In addition, Ms. Yellen also warned about the risks for retail investors to buy Bitcoin. “It is a highly speculative asset and you know, everyone should know that it can be extremely volatile and I am worried about the potential losses investors might suffer.” Ms. Yellen, who for many years was the chairman of the Fed, said.
However, Bitcoin is still up over 360% in the past 12 months and around 60% since the beginning of the year. Price fluctuations up to 10% / session are not uncommon in the cryptocurrency market. Bitcoin rose to nearly $ 20,000 in 2017 before falling 80% in value the following year.
The digital currency just hit a market cap of $ 1 trillion last week, although it has now fallen below $ 900 billion. It has received a boost from news about Wall Street banks and big companies like Tesla and Mastercard.
However, over the weekend, Elon Musk, who has been very excited about Bitcoin for the past few months, suddenly said that Bitcoin and Ether prices “look high”. This announcement comes not long after Tesla himself announced that it had bought $ 1.5 billion worth of Bitcoins. Tesla shares also fell the most since September 23 following Musk’s announcement
Glen Goodman, a trader in the UK, said: “It’s a virtual wildfire. Dry wood waits for a spark and Elon Musk is that spark. Crypto futures traders have borrowed a lot.” money to buy Bitcoin contracts, they cause the rate of borrowing to skyrocket “.
In fact, Bitcoin has received interest from mainstream investors for its notion that it has a storage value like gold. Investors are optimistic that it could become a hedge against rising inflation.
Source : Genk