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Blood, Sweat and Tears was right: what goes up must come down.
The Bitcoin slide, ongoing at the time of this writing, must have melancholy followers, as the crypto-pound 800-pound gorilla has fallen by around 14% in the last week alone. At his most recent $ 32,000, one wondered if the $ 30,000 level could be exceeded. We were a long way, it seems, from the recent zenith of bitcoin above $ 60,000, when enthusiasts bragged about $ 100,000 and more.
Investor psychology (and speculator psychology) tends to like round numbers. And if bitcoin drops below $ 30,000, the digital supply might struggle to find help. Volatility is one thing, the boost is another and in Wall Street lingo, weak hands may (or may not) be shaken.
Now it’s on a commercial basis. It’s important to note that fundamentals, as measured by the most recent headlines, point to some turbulence ahead. On the one hand, as noted in this space, bitcoin is warmly welcomed by El Salvador. Once again this week, the president of that country said he would introduce legislation that would treat bitcoin as legal tender, right next to the official national currency, the US dollar.
PYMNTS noted this week that the introduction of bitcoin would bring into traditional El Salvador trading a currency that does not have an underlying asset or an anchor, or a band to compete with the dollar. It can be a great experiment that validates bitcoin, but the practice of using cryptocurrency itself can have some friction, given the price swings that are evident even at this very moment.
But then there’s the flip side (digital). We live in a world where Elon Musk tweets an emoji (a broken heart) and bitcoin is sinking. We live in a world where El Salvador embraces bitcoin, but the economic juggernaut of China can put safeguards around its digital yuan, in part by banning cryptos from being part of the financial services landscape. The recovery of millions of dollars in cryptocurrency recently paid in ransom to Colonial Pipeline hackers could mean that bitcoin is not as anonymous as some cybercriminals might hope. This could mean that thieves are also fleeing crypto, which would be a good thing. But for crypto, at least right now and especially for bitcoin, you have to look below.
Learn more about Bitcoin:
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NEW PYMNTS DATA: STUDY ON CRYPTO-CURRENCY PAYMENTS – MAY 2021
About the study: U.S. consumers see cryptocurrency as more than just a store of value: 46 million plans say they plan to use it to make payments for everything from financial services to ‘grocery. In the Cryptocurrency Payments Report, PYMNTS surveys 8,008 cryptocurrency users and non-users in the United States to examine how they plan to use crypto to make purchases, what crypto they plan to buy. ‘use and how merchant acceptance can influence merchant choice and consumer spending.
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