MoneyCrypto The price and market capitalisation of the cryptocurrency bitcoin plunged earlier this year as countries like Russia and India prepared to follow China's lead and tighten crypto trading regulations.
Based on Coindesk data, the price of bitcoin in trading today, Monday (24/1), is at the level of US$ 35,944 or down more than 50% compared to November last year which reached US$ 66,935. The price of bitcoin has also fallen more than 20% since the start of this year.
The market capitalization has also fallen. As of today, the market capitalization of bitcoin reaches US $ 677 billion, down more than 50% compared to November 2021 which reached US $ 1.3 trillion. "Bitcoin has lost nearly half of its value since its November high," CNN International said.
Bitcoin's demise at the start of the year coincided with a number of countries' economic policies. The Federal Reserve of the United States, for example, has hinted that economic stimulus may be loosened more aggressively than previously anticipated. Investors are wary of digital currencies and other hazardous assets as a result of this.
Then, the governments of Russia and India are also increasingly pressing bitcoin and other cryptocurrencies. Quoted from Reuters, last week Russia's central bank proposed a ban on cryptocurrency transactions and mining.
The Russian central bank said that cryptocurrencies could jeopardise the country's financial stability because of the highly speculative nature of trade and the potential for market price bubbles. Furthermore, its mining has a negative impact on the ecosystem.
"Thus, mechanisms should be developed to block transactions aimed at buying or selling cryptocurrencies," Russia's central bank said.
In November 2021, India also said it was preparing to introduce a Law that would regulate digital currencies. While earlier this week, Indian Prime Minister Narendra Modi said that global cooperation was needed to tackle the problems posed by cryptocurrencies.
The Chinese authorities outlawed bitcoin transactions and digital asset mining in September of last year. Ten Chinese institutions have decided to ban cryptocurrency transactions, including the central bank, financial institutions, securities institutions, and foreign exchange authorities.
"All cryptocurrency activities are illegal and will be eliminated in accordance with the law," the People's Bank of China (PBoC) said in a statement.
The PBOC reasoned the ban was to maintain national financial security and stability. In addition, China has launched a digital yuan for the entire population to use.
Despite the pressure, some are still optimistic about bitcoin and other cryptocurrencies. Goldman Sachs, for example, said that the price of bitcoin could reach more than US$100 thousand in the next five years.
In fact, Antoni Trenchev, the founder of blockchain-based financing firm Nexo, predicted a price increase of up to US$ 100,000 per coin this year. Because institutional investors are putting money into bitcoin treasuries in droves.
MicroStrategy and Square are examples of companies that are known to buy bitcoins in bulk. "So I think bitcoin will hit $100,000 per coin this year," Trenchev told Business Insider earlier this year (3/1).
Jurien Timmer, global macro director at Fidelity Investments, noted that bitcoin is showing an increasing trend in value over time. According to him, investors expect a sustained increase in bitcoin price in the long term driven by organic market movements.
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January 23, 2022
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