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The price of bitcoin was yo-yo again on Wednesday morning. Photo: Edward Smith / Getty Images
Bitcoin price (BTC-USD) has risen back above $ 40,000 (28,346) after losing sessions, but trembles as fund managers say cryptocurrency is in bubble despite the price crash.
According to a Bank of America survey, 81% of fund managers say bitcoin is still a bubble. The flagship crypto fell around 37% last month and its price is down 38% from its peak of $ 64,829 in mid-April.
The price of bitcoin, which was inflated this week by bullish comments from financial manager Paul Tudor Jones and Tesla boss (TSLA) Elon Musk, was yo-yo again on Wednesday morning. It fell 0.7% to $ 40,012. It traded as low as $ 39,746.
Chart: Yahoo Finance
Other cryptocurrencies followed a similar trend, with Ethereum (ETH-USD) the second largest crypto by market cap down 3.6% to trade at $ 2,526. Meme dogecoin token (DOGE) also fell 3.6% to $ 0.31.
Watch: What are the risks of investing in cryptocurrency?
Read more: Bank of England’s Bailey: Digital Currencies Won’t Get Free Passes
Cryptos have recently been bolstered by institutional support. Several organizations, including MicroStrategy (MSTR) and Tesla, have invested billions of dollars in cryptocurrencies and traditional financial firms like PayPal (PYPL) and Goldman Sachs (GS) have started to manage assets on behalf of clients. .
However, it has also faced stiff opposition from governments and central banks who have insisted on regulating digital currencies.
On Tuesday, Bank of England (BoE) Governor Andrew Bailey said digital currencies would not get a regulatory “pass” in the future, despite their potential for innovation.
Speaking at TheCityUK’s annual conference, Bailey said the bank must “offer a lead in setting the rules of the road,” noting that catching up with digital currencies is not a recipe for success.
Bailey doubled down on his earlier position that bitcoin is not money and has no intrinsic value because it has no backing. He added that stablecoins have the potential to become systemic due to their importance in the financial system and its stability, and that UK authorities are already considering the regulatory approach for systemic and non-systemic stablecoins.
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The UK’s Financial Conduct Authority has previously warned that if consumers invest in crypto assets, “they should be prepared to lose all of their money.”
In May, Chinese Vice Premier Liu Hu said that China “will severely crack down on illegal securities activities and severely punish illegal financial activities.”
Watch: What is bitcoin?
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