China cautions that the value of Bitcoin is approaching zero, but the Bank of England sees the bright side
China cautions that the value of Bitcoin is approaching zero, but the Bank of England sees the bright side
By alerting cryptocurrency investors that the price of Bitcoin (BTC) is "going zero," the Chinese government has benefited from the abrupt decline in the cryptocurrency market.
According to the South China Morning Post on Wednesday, China's government news agency Economic Daily has published a warning against the biggest cryptocurrency by market cap in an effort to deter people from adopting it.
An "major external reason" contributing to the volatility of Bitcoin, according to the Economic Daily article, is the West's creation of a highly leveraged market "full of manipulation and misleading technology concepts."
According to the publication, "Bitcoin is nothing more than a collection of digital tokens, and its rewards come mostly from buying at a low price and selling at a high price." "Bitcoin will revert to its original worth, which has absolutely no value, in the future once investor confidence erodes or when sovereign states deem the currency unlawful."
The Chinese government outlawed bitcoin mining in July and has grand plans to introduce the Chinese Digital Yuan (e-CNY), its national digital currency, across the country. In September of last year, it outlawed all cryptocurrency transactions, and in 2018, it forbade foreign cryptocurrency traders from conducting business there.
Not just the Chinese government considers forecasts for the direction that the price of Bitcoin will take. Tom DeMark, the founder and CEO of market research firm DeMark Analytics, stated to Marketwatch on Monday that he thinks the cryptocurrency market is ready for sustained price declines because BTC has dropped less than 50% from its peak of $69,000 in November: Such breakdowns strongly suggest that reaching Bitcoin's all-time highs will probably take several years, if not decades.
As he stated, "This does not eliminate the prospect of a rebound of up to 50-56 percent over the following months, meaning that Bitcoin will increase to $40,000—$45,000," there is still a chance of it going back to the $40,000 level within the next few months.
The Bank of England (BOE) started to perceive the benefits of wealth accumulation in the cryptocurrency area during a down market, in contrast to Beijing's warnings. John Cunliffe, deputy governor of the Bank of England, stated to Bloomberg on Wednesday that cryptocurrency businesses who have survived the present crisis may become the "leading players" in the sector when things turn around. "I anticipate cryptocurrency technology and finance will persist, regardless of what happens to assets cryptography during the coming months. It has the ability to drastically improve efficiency and alter market structure.
Nip Bukili, the president of El Salvador, spoke to the Bitcoin community on Saturday about the falling price of bitcoin. Because he is certain that prices will rise again, he tweeted that people should "stop staring at the chart and enjoy life."
President Bukele has received harsh criticism for his cryptocurrency investments and has already incurred losses totaling tens of millions of dollars. Finance Minister Alejandro Zelaya has countered that these losses are not losses "since we have not sold coins."
According to CoinGecko, BTC is currently trading at $20386; down 71% from its all-time high and 0.7% over the previous 24 hours.
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