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Cryptocurrency Markets Collapse (June 22).
After a year of gains and records, the crypto markets are going through a turbulent period.
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Bitcoin and other major cryptocurrencies saw their stock prices drop significantly after China announced new regulations.
The top Bitcoin cryto is down 3.23% in the last 24 hours, followed by Ethereum (-6.48%), Binance Coin (-15.07%), Cardano (-13.81%), XRP (-15.26%) and Dogecoin (26.11%), according to coinmarketcap.com.
It follows recent crashes caused by Tesla doing an about-face in accepting Bitcoin as payment for its products and China cracking down on initial coin offers, block exchanges and warning against speculative trading.
Another blow came when China ordered the complete shutdown of Bitcoin mining in its Sichuan province and further asked banks to stop supporting crypto transactions, as part of a final wave of restrictions on cryptos.
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Will the crypto market recover? When cryptocurrency could rebound, Bitcoin wasn’t the only cryptocurrency feeling the effects of Tesla’s decision. (Photo: Shutterstock)
Why is the crypto market down?
China’s crackdown on cryptos comes days after Musks’ shock news broke.
Musks’ decision means a dramatic turnaround for Tesla, which only started accepting Bitcoin as a payment method for its services in February 2021.
It happened after the electric car maker bought $ 1.5 billion (1.06 billion) of Bitcoin shares, which sent the market price of crypto and Tesla skyrocketing.
The billionaire entrepreneur said: We are concerned about the rapid increase in the use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of all fuels.
Musk reaffirmed his belief that cryptocurrency has a bright future but that it cannot cost the environment dearly, in his Twitter post.
Musk is a longtime cryptocurrency advocate and Tesla’s move has been felt across the market as the price of other digital tokens plummets.
What is the price of Bitcoin and Ethereum?
At the time of writing, the current price of Bitcoin is 22,851.19 according to Coinbase.
The price drop is consistent with the crypto’s drop of -2.92% over the past hour (9:30 p.m., June 22).
In the past 24 hours, Ethereum has fallen to a value of 1,351.14.
Cryptocurrencies are seen as an alternative to traditional, cheaper banking methods for moving money because they are not regulated by the government or its banks.
Tesla’s move, and announced by Musk, was seen by some as undermining the credibility of cryptos to become a viable payment method against physical currencies.
What are crypto prices going down?
Bitcoin was not the only cryptocurrency to feel the first effects, with the rest of the top 10 all experiencing declines in value.
Dogecoin, which was initially created as a joke in 2012 before its stocks shot up, faced the worst with large double-digit declines due to the China crackdown.
The influence of Musks cannot be underestimated because, while PayPal, Mastercard and Facebook have backed cryptos, Tesla’s announcement has always rocked the market.
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