The largest cryptocurrency touched $ 33,400 on Sunday morning, almost 20% below the $ 41,200 it traded on Tuesday afternoon.
Bitcoin (BTC) fell during the weekend below US $ 36,000 affected by the closure of mining farms in China and a possible increase in regulations in the Asian country, and accumulated its sixth day in a row in fall after having exceeded $ 41,000 at the beginning of the week.
The largest cryptocurrency reached US $ 33,400 on Sunday morning, almost 20% below the US $ 41,200 that it traded on Tuesday afternoon, although it later recovered strength to reach above US $ s35,400 in the afternoon, according to data from the Coinmarketcap portal.
The so-called “hashrate” -the unit of measurement that explains the processing power of the Bitcoin blockchain- is falling significantly in China as the government of that country advances with local closures in which the cryptocurrency is mined, which is affecting its price worldwide, given the number of network transactions that are certified in that country.
In fact, an estimate by the University of Cambridge put about 65% of the world’s Bitcoin mining taking place in China in April 2020.
“In the long term, most consider that China’s exit is positive, but in the short term it may lead to inventory sales“said Jonathan Cheesman, head of institutional and over-the-counter sales at crypto derivatives exchange FTX, as quoted by Bloomberg.
One of the factors cited has been concerns that China will clamp down on mining amid concerns over energy use and deadly coal accidents.
The city of Ya’an, in the southwestern region of Sichuan, promised provincial authorities to eliminate all Bitcoin and Ether mining operations within a year, a person with knowledge of the situation said, according to Bloomberg.
According to a Global Times report, backed by the Communist Party, the closure of many Bitcoin mines in the province has resulted in the closure of more than 90% of China’s Bitcoin mining capacity.
Elon Musk’s ads
Earlier in the week, the owner of the Tesla company, Elon Musk, denied having sold a significant part of the Bitcoin that the company bought at the beginning of the year and said he was willing to accept the cryptocurrency as a form of payment for his electric cars in the future, which had made its price jump to $ 41,000.
Musk’s views for and against Bitcoin made its price move
The interesting thing is that he had also been the one who triggered, among other factors, a cryptocurrency sell-off by criticizing the amount of energy used by the servers that support BTC and denying his customers the option to buy their cars using the cryptocurrency.
“These days, the Bitcoin market revolves around what Elon Musk tweets; to me, that’s not a great indicator. It’s like a billionaire’s whim,” said Marc Odo, Client Portfolio Manager, Swan Global Investments.
After reaching its all-time high of $ 2.6 trillion in mid-April, the market value of all cryptocurrencies fell by almost half to about $ 1.45 trillion.
Bitcoin and bricks
The advancement of cryptocurrencies continues to gain intensity in the real estate scene. In the field of brick, they point out that the trend is here to stay and they expose as proof the multiplication of projects that accept, for example, the bitcoin as a payment option.
Actors of the sale and development affirm that the alternative is beginning to be in force for new projects and ventures even in the “wellhead” instance.
They argue, at the same time, that this growing acceptance and ease of use will generate an expanded trust that will result in a strong increase in operations closed through bitcoin or its similar.
The opening towards cryptocurrencies is such that, especially in this first semester, the Argentine Real Estate Chamber (CIA) It generated successive training activities with the aim of expanding the platoon of developers and marketers that operate with this option.
“We want to generate knowledge because we understand that there will be an increasing adoption. In Argentina we see an incipient acceptance and in the world the option is growing strongly, especially in countries like the United States or Spain“, said to iProfessional Alejandro Bennazar, head of the CIA.
“We are generating training for the sector with the idea of providing key details for the operation. We do not want to stay in time or out of these types of trends,” he added.
In the brick and mortar scene and financial activity, they provided opinions regarding how cryptocurrencies are being used in Argentina.
In that direction, Matías Wepfer, a benchmark for Rosbaco & Partners, commented to this medium that in the real estate business today, in Argentina, the number one application of cryptocurrencies it is as a means of payment to be able to agree to buy a property, be it well or finished.
“It is up to both parties to accept payment using that currency. Then the seller decides what to do, if you hoard or exchange the option for a physical currency“, he specified.
Wepfer commented that the firm had “the opportunity to sell units with payment in cryptocurrencies and our experience was very good. What is happening today in real estate is that more and more actors are beginning to accept the option and that gives a greater flow to the market”.
“Argentina is one of the countries that initially bet on bitcoin and secondary networks like Ethereum“, said to iProfessional.
The expert also said that the possibility of covering payments is beginning to show a presence in “well or finished projects”, at the same time that he stated as an advantage that the alternative in question operates in a “deregulated, decentralized” market.
The entities of the real estate sector sponsor activities to spread its adoption.
How to operate
“Cryptocurrency operations imply an agreement between parties, a private exchange, where both the buyer and the seller have to agree to set the currency from which the value for the operation and exchange will be set. That is, an exchange rate is agreed that convinces both parties“, he claimed.
From Global Investments, its commercial manager, Gustavo Cuadra, explained to iProfessional how is the surgery.
“The cryptocurrency holder is contacted, chooses the property and the value of the day of the operation is set. Then, he transfers to an account that we provide and, when the bitcoin or cryptocurrency is credited, the same is done with the property. A sales ticket arises in the agreed value, as if it were a bank transfer, “he said.
According to Cuadra, “the value of an apartment can be paid in full or proportionally“through that alternative.” Today all our projects allow this type of payment. Both those that we have in development and those that come in the future, “he commented.
“The opportunities are enormous. There are more than 7,000 cryptocurrencies on the market, although the best known is bitcoin. Well, Today with two bitcoin you can buy a 3 room apartment“, graphic.
Trading through options like bitcoin it includes, even, projects in launch.
Actors of the sector assure that two bitcoin are enough to acquire a three environments.
What is “tokenization”?
For his part, Néstor Kreimer, CEO of Cryptokuántica, provided details of one of the key aspects for operating with cryptocurrencies in the real estate field: “tokenization”.
“It is the division of an asset in which each part is called a ‘token’ or digital token that represents it. The disruptive novelty is that this token is generated through a ‘smart contract’ on blockchain, something typical of the new world of cryptoeconomics. In this way it is possible to democratize access to investments in bricks from small amounts, “he explained to iProfessional.
In keeping with this, Kreimer highlighted the ease of payment that cryptocurrencies enable as another variable to highlight.
“Paying with cryptocurrencies can be incorporated by anyone. There are no barriers to entry. The transaction is the same, only now the payment is accepted through that alternative. That makes everything more agile and secure. It also implies stopping moving with money, and the banks do not even intervene since they do not operate on the institutional financial system, “he synthesized.
“At the local level there is no limitation and everything is established by a consensus between the parties. If the seller later wants to ‘dollar bill’ he can sell his cryptocurrencies. Between pairs or through ‘exchanges’ of recognized international prestige,” he completed.
Another example of how the adoption of this form of payment has been accentuated can be located in, for example, the emergence of platforms such as Crypto Notices. It is a site that has been in operation for just over two months and accumulates just over 1,000 real estate and other property notices that are offered, precisely, in cryptocurrencies.
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