After the infamous tweet by Elon Musk about Bitcoins and his concern about their impact on the environment, the skyrocketing valuation of the cryptocurrency fell hard. It is not just the fault of the tesla, so even new regulations by the Chinese government have created an extremely volatile situation for Bitcoins in particular and cryptocurrencies in general.
The dramatic fall of this flagship e-currency to even 30000 US dollars at one point was extremely concerning. However, the price may have gone up; however, it is still far from the dramatic rise that it had been witnessing since the second half of 2020.
Back to Gold
The situation surrounding The fall of the price of Bitcoins has even led JP Morgan to release a report stating that many investors are now appearing to be contemplating moving back to investing in gold. For a long time, many people, especially cryptocurrency enthusiasts, have rallied for Bitcoins as the opponent to the valuable metal as a form of investment.
These comments, along with Elon Musk’s refusal to accept Bitcoins for the payment of Tesla cars, have disillusioned many. A lot of people who previously swore by the SpaceX CEO posted scathing tweets about him. The encouraging tweets by Elon Musk about Bitcoins as well as Dogecoin led many people to invest in these cryptocurrencies.
Unfortunately, the shocking downfall of these cryptocurrencies led too many people to go bankrupt as they had invested all their life savings following Musk’s encouraging messages.
Some more reasons for the fall in Bitcoin prices
There is no denying that Elon Musk played a considerable role in changing the tide for Bitcoins. However, there are many more reasons that have to be taken into account for the price fluctuation. Some of the reasons are given below:
- The acceptance rate of Bitcoins by companies is often exaggerated. Only about 15000 businesses worldwide accept this flagship e-currency as payment as of last year. It may seem like a significant number; however, considering that there are more than 500 million entrepreneurs worldwide, the actual picture is pretty grim for Bitcoins.
- The popularity levels of Bitcoins are at an all-time high; however, it has not reached anywhere close to the transaction power of debit or credit cards worldwide. While billions of credit card transactions are processed daily globally, the number for Bitcoins is somewhere close to 300,000. Such reports concern investors who are now even considering whether a small percentage of Bitcoins or other cryptocurrencies should be a part of their portfolios.
- The constant dilution of cryptocurrencies by new forms of currencies is almost turning this world into a joke. Investors are honestly considering whether the cryptocurrency has any future in the world, and it will just become a fad in a few years to come.
- The decentralized nature of cryptocurrency is also being questioned. These currencies had been created so that the concentration of coins will not be in the hands of few. However, in reality, only around 2100 addresses on more than 40% of all Bitcoins. Therefore people slowly realize that even in the crypto world, the rich are the ones who are accumulating all the wealth.
If you still have faith in Bitcoins and want to try your luck with this volatile cryptocurrency, you can go on the bitcoin profit Websites such as this one to help users trade and invest in Bitcoin. Even the most layperson with no knowledge of cryptocurrency can go on this website to know more about the world of e-currencies. However, it must be mentioned that if you want to use Bitcoins to generate profit, it will be to your benefit to research more about it before stepping into the lucrative world of cryptocurrency trading.