Bitcoin slides below $40,000 after China's new crypto curbs
Bitcoin fell below the $ 40,000 mark on Wednesday to a 3-1 / 2 month low and dragged the prices of some digital currencies after China set new limits on transactions involving cryptocurrencies.
Bitcoin, the largest and most well-known cryptocurrency, was already under pressure from a series of tweets from Tesla CEO Elon Musk, but news from China sent him $ 38,514, a 9% fall.
By 0855 GMT, it had risen to $ 40,627, down 5% in the program.
The cryptocurrency fell nearly 40% from a record high of $ 64,895 hits on April 14. It reverted to its first month-long decline since November 2018.
The decline in Bitcoin caused some crypto assets on Wednesday, while Ether, the currency linked to the ethereum blockchain network, fell by 12% to $ 2,988, while meme-based dogecoin fell by 18%, according to the trader. marketer Coingecko.
Shares on crypto currency Coinbase (COIN.O) fell 4% in pre-market trading. Coinbase shares lost 45% of their value from the peak hit on the day of their direct listing from April to Tuesday.
The decline in Cryptocurrency last week was due to Musk's conversion to Tesla to accept bitcoin as payment. His next tweets caused confusion as to whether the builder had squandered his money.
The sale expanded China’s announcement on Tuesday to ban financial institutions and payment companies from providing services related to cryptocurrency transactions. It also warned investors about crypto trading. Learn more
“The crypto markets are currently considering the issue of bear-witness issues in price development,” said Ulrik Lykke, executive director of the crypto hedge fund ARK36.
"Stories like these can be strongly influenced and aroused in the markets but often prove little value in the future. The crypto markets are very emotionally driven and their participants tend to overreact to events they see as negative."
However, some cryptowatcher authors predict a lot of losses to come, noting that a fall below $ 40,000 represents a breach of an important technical barrier that could set the stage for more sales in the short term.
INFLATION HEDGE
More importantly, investors are likely to move from bitcoin to gold, say analysts at JPMorgan, citing data-based comparisons on an open profit basis in future CME bitcoin contracts.
This reflects the "sustainable and sustainable oil closure" of bitcoin futures since last October, they told clients, adding: "the bitcoin flow picture continues to deteriorate and indicates continued recession by institutional investors."
The selloff of crypto assets at a time when fears of inflation are high is detrimental to the concept of an asset class that acts as an inflation fence.
Instead, with more traditional fences gaining ground, gold increased by about 6% so far this month.
The latest selloff in bitcoin and other digital currencies has taken the market capitalization of all digital currencies back below $ 2 trillion, down from a recent $ 2.5 trillion record.
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