Sunday, April 14, 2024

Bitcoin goes flat on its face and falls

The Bitcoin and other digital currencies tumbled on Thursday, a fall likely stoke speculation about the durability of the boom criptomonedas.

The digital currency falls 10.94 percent, to 17,273.16 dollars, this at 7:48 am in Mexico City.

The Bloomberg Galaxy Crypto Index fell more than 6 percent at one point.

“There is a massive overbuying of conditions and they are heading for a correction,” said Vijay Ayyar , head of business development at Singapore-based crypto exchange Luno. “So I don’t think it’s unusual, frankly.”

Even with the pullback, bitcoin has gained more than 100 percent this year and was until recently approaching the record high of $ 19,511, set in 2017.

Cryptocurrency fans point to purchases by retail investors, institutions and even billionaires , as well as seeking hedging against the weak dollar from the pandemic, as reasons the boom may last.

Skeptics argue that the famous volatility of the cryptocurrency heralds a repeat of what happened three years ago, when a bubble burst in spectacular fashion.

Some see signs that retail investors are concentrating to take advantage of momentum and make quick profits.

Concerns about the possibility of stricter U.S. cryptocurrency rules, as well as profit-taking, help explain the price drop in most major digital assets, said Ryan Rabaglia, global head of operations at OSL brokerage. Hong Kong.

“It is also not unusual to see a short-term pullback after periods of significant and accelerating advances as traders look to take profits, before settling back when volatility subsides,” he said.

“Once the dust has settled, we will go back to business as usual, with all the medium and long-term bullish indicators there.”

Proponents of digital assets indicate that the current attention on cryptocurrencies compared to three years ago is different, due to growing institutional interest, for example, from companies like Fidelity Investments and JPMorgan.

This week, Van Eck Associates has released an exchange-traded Bitcoin note on Deutsche Boerse Xetra. In October, PayPal announced that it would allow its customers to access cryptocurrencies.

There is also noise around ethereum, the world’s most widely used blockchain, which is going to undergo a network upgrade that would allow it to process a similar number of transactions to Mastercard and Visa . The change to the new system could curb the supply of ether, whose price has quadrupled so far this year.

Luno’s Ayyar pointed out that he expects bitcoin to stabilize and reach all-time highs. But that would be followed by a bigger drop in the cryptocurrency, he noted.

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