Cryptocurrencies have experienced great volatility in recent days, with steep drops and rises caused by decisions made by the Chinese authorities and by Tesla and its CEO, Elon Musk, which coincide with the 11th anniversary of the first bitcoin transaction.
Specifically, this cryptocurrency traded this Friday at the close of the Spanish market with 9.44% loss, equivalent to 3,871 dollars, and stood at 37,508 dollars (30,780 euros), while ethereum fell 14.23%, about 414 dollars, to settle at 2,485 dollars (2,039 euros).
With this data, bitcoin loses 41% since it reached its historical maximum of almost 64,000 dollars (52,400 euros) on April 13, while ethereum left 40.4% compared to its 4,173 dollars (3,418 euros), registered on May 12.
Last week, Musk announced on Twitter that his company would stop accepting bitcoin as payment due to the use of fossil fuels for the mining process of cryptocurrencies and the management of their transactions.
“Tesla ha vehicle purchases with bitcoin suspended. We are concerned about the increasing use of fossil fuels for the process of mining cryptocurrencies and transactions of bitcoins, especially coal, which has the worst emissions of any fuel, “announced the billionaire.
This decision caused the price of these assets to sink, reaching the bitcoin touching the $ 47,919 (39,309 euros) and ethereum, 3,584 (2,940 euros).
Likewise, the XTB analyst, Darío García, recalled in statements that Musk had already made wobble these markets a few weeks earlier when he said on his visit to Saturday Night Live that dogecoin was a “meme currency.”
But the falls did not stop there: this Wednesday, the aChinese authorities prohibited taking part in the business from cryptocurrencies to financial institutions and relevant payment services.
The decision caused both bitcoin and ethereum to undergo strong corrections of up to 20%, up to 34,515 (28,315 euros) and 2,486 dollars (2,039 euros), respectively.
The price of both assets rebounded on Thursday at noon: it turned around at around 2.30 p.m. and an hour later, experienced rises above 20% due to a tweet from Musk in support of dogecoin, a type of post that tends to cheer on all of these assets.
The joy did not last long and late in the afternoon they registered falls again due to the US Treasury’s decision to force any transfer over $ 10,000 (8,186 euros) to be reported to the IRS (Internal Revenue Service).
The latest downward movement comes from China again. The Asian giant plans to take measures against bitcoin mining activity and against certain behavior when trading this type of asset. This has caused, once again, crypto assets to register sharp falls close to 12%.
Is volatility is not unusual in cryptocurrencies, the price of which varies a lot, although it is true that there are not usually such sharp drops and rises in such a short space of time.
The IG analyst, Diego Morín, highlighted in a comment sent that it must be taken into account that “the correction that is taking place in the market is normal and natural”, since it was in a continuous overbought and “I had no “gas” to continue breaking resistances“.
Morín also highlighted the speculative movements produced by those price drops that “strong hands” have taken advantage of to eliminate retailers, which has allowed them “to re-enter more attractive prices to continue their upward course.” “We will see if it is a mere rebound or a consolidation of prices,” he said.
Despite the falls registered in the last week, García defended a few days ago in statements that crypto assets were the ones that better performance they had faced inflation.
“Removing the short-term effects that we have been seeing (…), cryptocurrencies are the ones that have had the best performance with the entire monetary mass that has been created in 2020, “Garcia highlighted.
11 years since the first Bitcoin transaction
This Sunday May 22nd 11 years from the first transaction bitcoin history: user Laszlo Hayneck paid 10,000 bitcoin for two pizzas in Jacksonville (Florida, USA). What at that time was around $ 30 (24.63 euros), would now be 375.08 million (308 million euros).
Bitcoin did not reach the dollar until February 2011 and by July of that year, it was already worth 31 dollars (25 euros). Two years later, it went up to almost 300 (246 euros) and at the end of 2017, it starred in a rally That raised it to $ 20,000 (16,400 euros).
The crash was as strong as the rise and by February 2018, worth $ 6,400 (5,256 euros). Since then, the cryptocurrency has registered strong rises followed by strong falls, although it was not until March that we saw a drop of that caliber: from the $ 9,000 at which it was listed, it fell to $ 4,000 (3,285 euros).
As of that date, the asset began a rally bullish that it’s only slowed down now, since from October several corporations such as Mastercard, Paypal or BBVA began to accept operations with bitcoin.
Bitcoin, a response to central bank policies?
The UIC Barcelona professor, Pablo Agnese, has defended in statements that cryptocurrencies are a response to central bank policies and to your discretionary decisions about how much money to print. “We do not need a regulatory entity,” he stressed.
Likewise, it has affirmed that the falls that crypto assets have registered in recent days they are not so important given its intrinsic value and has influenced that the important thing is the long-term vision, given the “technological revulsion that is the blockchain“.
On the contrary, there are other experts who warn that crypto assets are experiencing a bubble similar to 2017 and that strong falls are expected once they deflate.
Regarding the challenges to come for bitcoin, Agnese has pointed out her scalability and its energy sustainability, while he has highlighted the disadvantages that there are many cryptocurrencies in the market and the intention of central banks to create their own centralized digital currency.