Friday, May 28, 2021
Almost double-digit discounts
Cryptocurrencies are rushing down again
Bitcoin and Co. are notorious on the stock exchange for their roller coaster rides. But the latest downward spiral may have good reasons: Japan’s central bank chief criticizes the speculative character of the cryptocurrency and prices are already falling by double digits.
The cryptocurrency market has come under renewed pressure. Bitcoin, the best-known and largest Internet currency in terms of market share, fell by around eight percent to $ 35,340 on the Bitstamp trading platform. The second largest cryptocurrency, Ether, fell by around ten percent and fell below the $ 2,500 mark. Other digital systems also lost almost double-digit percentages. “Bitcoin is still in a downward spiral and is struggling to break free,” says Emden Research analyst Timo Emden.
Experts named critical tones from the ranks of the Japanese central bank as the reason for the recent price decline. Their boss Haruhiko Kuroda had denounced the high price fluctuations and what he saw as the speculative character of Bitcoin. He thus joined the circle of many central bankers who are critical of private-sector cryptocurrencies. Numerous central banks are therefore aiming for digital versions of their own currencies. In the past week, the crypto market collapsed within a short time after the Chinese central bank expressed its criticism of digital systems.
Beijing reiterated an earlier announcement to crack down on cryptocurrency manufacturing. The generation of digital currencies is also called mining and consumes enormous amounts of electricity to produce them.
The Tesla boss creates turbulence
Previously, Tesla boss and crypto advocate Elon Musk had already caused the market for cryptocurrencies to be agitated several times. Musk seemed to be suggesting that the electric car manufacturer Tesla could dispose of its Bitcoin holdings. Musk quickly denied it, but the price movements in Bitcoin were enormous.
Another negative factor came from the USA. On the Thursday before Pentecost, the US Treasury Department announced that it was considering reporting crypto transactions of more than $ 10,000 in order to ensure tax compliance. If the project is implemented, it would be a blow to the anonymity of transactions, which is so valued by crypto fans.
Despite the heavy losses in recent weeks, Bitcoin still costs almost four times as much as a year ago. The massive fluctuations show the dilemma of the market for digital currencies – it promises high profits on the one hand, but immensely high risks.
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