It sinks more than 14% and is trading at $ 46,000 / Argentina News

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The world’s leading cryptocurrency suffered its biggest daily decline in a month. It readjusts its price after the historical maximum of US $ 58,354 reached on Sunday

The main cryptocurrency in the world suffered his biggest daily casualty in a month, when it fell to US $ 45,000, a fall of 17%, to later recover its value a little and moderate the loss to 14%.

The decline extended the currency’s fall from the all-time high of $ 58,354 reached on Sunday, although Bitcoin is still posting a gain of around 60% this year.

“The types of hikes we’ve been seeing they are not sustainable and they only invite to withdraw from this asset, “said Craig Erlam, senior market analyst at OANDA.

Ethereum, the second largest currency of its kind by market capitalization and often moving in line with bitcoin, was also down more than 17% and was later trading at $ 1,461, a nearly 30% decline from last year. record reached last week.

Cryptocurrency markets have seen a strong escalation this year since large companies and institutional investors began to take the emerging asset seriously, bringing money to the sector and generating confidence among small speculators.

An investment of $ 1.5 billion by electric car maker Tesla helped the virtual currency to appreciate above $ 50,000 and that could lead to the price of the company’s share becoming more sensitive to changes. bitcoin operations.

After hitting its record, Bitcoin fell more than $ 14,000

Some analysts link the cryptocurrency’s decline to a comment on Twitter by Tesla CEO Elon Musk, in which he noted that Bitcoin and Ether, the second most widely used cryptocurrency, were probably too high.

Bitcoin’s latest bullish streak began precisely after Tesla’s decision to invest $ 1.5 billion in that cryptocurrency. The upward trend was accentuated after the payment company Mastercard and the bank BNY Mellon announced days later that they would allow the use of cryptocurrencies in their services.

The Secretary of the Treasury of the United States, Janet Yellen, assured this Monday that Bitcoin continues to be established as a payment method and is “an extremely inefficient way to carry out transactions.” The famous cryptocurrency is not the only one that gives ground since the red numbers prevail this Tuesday among digital currencies since Ether also falls strongly, since it has gone from $ 1,975 on Sunday (its historical maximum) to $ 1,500 to those that are listed now.

At $ 50,000 “it’s the biggest bubble of all”

The Economist Peter schiff, owner of the US brokerage Euro Pacific Capital, stated on Twitter that “a financial asset is in a bubble when its price is unrelated to its underlying present value or a reasonable expectation of its future value.”

“Investor conviction in price appreciation is high and fear of losing is low,” he added.

At $ 50,000, Bitcoin is the biggest bubble of all“, assured Schiff, who affirmed that” a movement of up to US $ 100,000 cannot be ruled out. Nor can you rule out a descent to zero“.

Distrust

For the moment, those responsible for monetary institutions distrust this virtual currency, created by anonymous and managed by a decentralized network.

The president of the European Central Bank, Christine Lagarde, warned in early February that bitcoin “was not a currency” and that it was a “highly speculative asset”.

For Alexandre Baradez, market analyst at IG France, there is a “marketing aspect“Obvious: some companies” integrate low amounts of bitcoins in their treasury to show that they follow the technological present, “he summarizes. But speculative fever has not yet reached Europe, Add.

“It is always the same, Europe adopts technologies two years behind the United States”, despairs the head of Bitpanda, who thinks that the Old Continent can catch up in the coming years.

According to analysts at cryptocurrency specialist ByteTree, Europe accounts for only 10% of bitcoins bought by funds.

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For some specialists, bitcoin is becoming the “new digital gold”

The Tesla effect

“It is mainly due to overly restrictive regulations”, estimates its founder, Charlie Morris, who does not think there will be European companies that will follow the Tesla model. The electric vehicle maker, founded by Elon Musk, the world’s richest man and a fervent supporter of cryptocurrencies, just invested $ 1.5 billion in bitcoins.

Digital giants like Google and Apple, with a treasury to overflowing, invest massively in the stock marketBut Tesla just scored a hit by investing in the volatile world of cryptocurrencies.

Not all investors like Elon Musk’s experiments. Since Tesla acquired bitcoins, the group’s stock fell. This “cost them more than $ 60 billion of market capitalization,” says a cryptocurrency market investor.

In late 2020, when prices started to rise, cryptocurrency fans were happy to see that the rise was due to professional investors, and not individuals, as in 2017, when prices soared and then collapsed. early 2018.

Many experts wait for a correction to occur, more or less brutal, of prices, although without giving up cryptocurrencies.

“As with the internet bubble, many new products related to bitcoin will disappear, but others, those that will be better capitalized, that will have more solidity, will remain”, estimates Alexandre Baradez.

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