Source: CCTV FinanceOver the past weekend, major cryptocurrencies represented by Bitcoin experienced a sharp decline due to concerns such as tighter regulation. The minimum value of Bitcoin has dropped below $52000, down nearly a fifth from its recent high, highlighting once again the enormous volatility and risk inherent in cryptocurrencies such as Bitcoin
Source: CCTV Finance
Over the past weekend, major cryptocurrencies represented by Bitcoin experienced a sharp decline due to concerns such as tighter regulation. The minimum value of Bitcoin has dropped below $52000, down nearly a fifth from its recent high, highlighting once again the enormous volatility and risk inherent in cryptocurrencies such as Bitcoin. However, there is still a significant divergence in the market's expectations for the future performance of cryptocurrencies.
The main cryptocurrencies, led by Bitcoin, have experienced a roller coaster trend in recent days. Last week, boosted by positive news such as the listing of the Coinbase cryptocurrency exchange, Bitcoin prices briefly exceeded $64000, approaching $65000,But during the weekend's sharp decline, it briefly fell below $52000, with a price difference of nearly $13000, a decrease of nearly 20% Other major cryptocurrencies also followed suit. Although these major currencies quickly rebounded, the gains in the past two weeks have also largely been completely reversed.
From the perspective of reasons, the market mostly believes that the Central Bank of Trkiye has announced a ban on cryptocurrency payments, and the rumors of a large number of cash out of Coinbase executives may be the driving factors. Bitcoin's rising and falling market is relatively common. After entering this year, there have been at least four significant corrections in the overall bull market.
The sharp drop over the weekend further highlights the high volatility and high risk of the cryptocurrency market. The founder of Coinbase also admitted in an interview on the day of its listing that regulation is one of the biggest risks faced by cryptocurrencies, and Federal Reserve Chairman Powell has repeatedly expressed bearish comments on both cryptocurrencies.
Federal Reserve Chairman Powell:Bitcoin and other cryptocurrencies have very high volatility, so they are not truly useful value storage tools, and cryptocurrencies do not have any endorsement support. They are more like speculative assets.
However, Brooks, who previously served as the acting director of the Office of the Comptroller of the Currency under the US Treasury Department, holds a different view. He believes that one of the reasons why cryptocurrencies are favored is that,The excessive oversupply of the US dollar has enabled cryptocurrencies such as Bitcoin to have the function of storing value.
Former Acting Director of the Office of the Comptroller of the Currency, Brian Brooks:Over the past year, our money supply has increased by nearly 40%, which means that from a supply and demand perspective, the function of the US dollar as a store of value has decreased by at least 40%. What I really want to say is that the US dollar does not actually have any real endorsement support. During the Nixon administration, the US dollar was decoupled from gold.
Every major decline in Bitcoin and cryptocurrencies has caused many people to sell out and suffer heavy losses. The most relevant advice in investing in cryptocurrencies may come from Ethereum founder Vitalik Butlin, who is not willing to invest any money that you cannot afford to lose.
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