London, England, 2 June 2021, ZEXPRWIRE, The Bitcoin price slam is the hot news for the crypto world in these past weeks. With the coin plunging to almost $30,000 at a certain time, its value was seen to have plummeted by more than half of its predicted highs earlier this year.
Up until late April, the cryptocurrency industry was thriving, however, altcoin rates have taken a beating since the Bitcoin market collapsed. The Investment Center broker Zack Teller details the prospects for this crypto giant while going over its recent plummet.
2021 for Bitcoin
Within the last months of 2020, the Bitcoin value was seen to be skyrocketing. Bitcoin was able to finally move through its stubborn $10,000 mark, breaking through 2017’s highest level, before hitting a $20,000 record. When 2021 rolled in, Bitcoin had become the world’s most valuable blockchain, being only a little under $30,000.
Elon Musk, the founder of Tesla, was seen to have a significant impact on Bitcoin price reports because he engaged with the masses through a series of tweets and updates on the cryptocurrency sector. It was announced that Tesla would spend $1.5 billion of its finances on Bitcoin. This was a game-changer as more and more corporate money began to flow into the blockchain currency and soon enough other notable US stocks followed suit.
A further noteworthy move was when Tesla decided to recognize payments through Bitcoin for their vehicles. But the company soon seemed to have realized that the environmental considerations of such a decision may be impactful. However, the simple decision that was taken formerly allowed Bitcoin to surge as high as reaching $65,000 in April and making unprecedented records.
The Dramatic Drop
When Tesla took back its decision of accepting Bitcoin in payment it was solely due to the environmental impact. The heavy energy consumption that is required to mine the coin was highly criticized by Musk and caused the price of Bitcoin to plummet. This is now leading to potential decelerations for cryptocurrencies as investors seem to be shifting focus towards coins like Cardano (ADA), that have a lesser carbon footprint in their mining methods.
These environmental issues coincided with a dialogue of federal reform with the United States. If this wasn’t a setback enough, China decided to tighten restrictions on mining operations as the government works to pave the way for their Central Bank Digital Currencies (CBDCs). With the new constraints, China was able to further contribute to the recent collapse in Bitcoin value as it is accountable for approximately 70% of the worldwide crypto production.
Investors are looking into questions of Bitcoin recovery and the time needed to bounce back. Much to their delight, the price is already clawing its way back up as once again Elon Musk tweeted about interacting with miners about systematic and standardized monitoring of energy utilization which Musk thinks is “potentially promising”. People believe if all goes well Tesla might just turn back to its decision about allowing payments through Bitcoin.
It is believed that for the remaining 2021, the value of Bitcoin will be rather less dependent on corporate trends. Investors are keen to keep an eye on inflation after the previous US price increases, however, inflation tends to be growing around the globe and markets worry about supply disruptions.
So what can we expect Bitcoin value to look like after summer 2021? Well following the recent damage, Bitcoin is likely to undergo a stabilization period in the coming months. Major investors may seem to be reluctant to participate given the regulatory movement by the world’s most powerful economies, China and the US. The questions of renewable energy are still ongoing and will put Bitcoin to the test before it could completely recover.
The coin quantity for cryptocurrencies is finite and thus most scenarios will witness large sums of capital pursuing towards a restricted supply in preferred ventures. Therefore, investors would have to wait and recognize how long the energy problem remains a major concern for Bitcoin as China might shut down several of its mining operations causing a further cut in the supply of coins.
Nevertheless, it is important to remember that the crypto industry is still volatile as it has always been and due to its extreme uncertainty it is difficult to anticipate the value of the coins shortly and much more difficult to predict long-term forecasts.
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