On the morning of June 8, 2021, the price of several major digital currencies plummeted due to a crypto market collapse. Bitcoin, Ethereum, and some other major cryptocurrencies saw their prices drop by 10% to 15% overnight throughout the latest market collapse. It comes after several cryptocurrencies hit all-time highs in April, through one Bitcoin token hitting £47,240.05 before plummeting in May and June. The drop was precipitated by Tesla’s no longer need to accept payments in bitcoin for its goods, only three months just after electric vehicle manufacturer purchased $1.5 billion (£1.06 billion) in the cryptocurrency.
Tesla CEO Elon Musk stated on Twitter that the business was abandoning its policy of accepting cryptocurrency due to environmental worries over Bitcoin’s mining process. Its effect was widespread, with Ethereum, Binance Coin, Dogecoin, XRP, as well as Litecoin among the most impacted. Bitcoin trading is very profitable these days as price has started to rise again. So, learn the fundamentals of bitcoin trading using btcrevolution.io application.
What Caused the Cryptocurrency Market to Crash?
Musk’s move is a dramatic reversal for Tesla, which just began accepting Bitcoin as payment because of its services starting February 2021. It occurred after Tesla purchased $1.5 billion (£1.06 billion) in bitcoin, sending its (and Tesla’s) market prices skyrocketing. However, due to claims of the environmental effect of Bitcoin mining – a complex process of minting modern digital coins – Tesla has removed this option for consumers.
“We are concerned about the fast-growing use of Bitcoin fossil fuels and transactions, especially coal, with the greatest fuel emissions,” said the billionaire entrepreneur. Musk in a Twitter post reaffirmed his belief that cryptocurrencies have a “promising future,” but “must be environmentally expensive.” Musk has long been a supporter of cryptocurrencies, and Tesla’s move was felt throughout the market, with the price of other digital tokens falling.
What Is the Current Price of Bitcoin?
The price of Bitcoin fell to approximately £20,000 at around 2 p.m. on May 19, less than half of its record high of £47,240.05 dated April 14, 2021. The price dropped significantly and was level around mid-January 2021 levels compared before another cryptocurrency had a successful three months in which its worth skyrocketed.
The announcement that Tesla had purchased $1.5 billion (£1.06 billion) in Bitcoin shares increased its value, sending the market price of either the cryptocurrency and Tesla skyrocketing.
However, Tesla’s move to change its policy of accepting Bitcoin as payment for its goods triggered a downward spiral for the cryptocurrency – which is down 21.43 percent in the past week – and other digital currencies.
According to coinmarketcap.com, Ethereum is down 35.56 percent, Binance Coin is down 45.20 percent, Dogecoin is down 35.12 percent, Uniswap is down -45.42 percent, and Litecoin is down 44.55 percent. And, whilst the market was beginning to recover, the June 8 collapse caused Bitcoin to lose 10.33 percent, Ethereum to lose 11.82 percent, Cardano to lose 13.15 percent, XRP to lose 11.66 percent, and Dogecoin to lose 12.32 percent.
Will The Cryptocurrency Market Recover, And When Will It Do So?
Cryptocurrency is notorious for dropping and then rebounding — Bitcoin has experienced this many times previously. The market’s volatility makes forecasting almost impossible. It may rebound and break prior highs, or it could collapse and never recover. This is why Bitcoin is a high-risk investment, and you’ll only invest whatever you can afford to lose. There are different viewpoints and a broad variety of solutions to those issues, so do what is best for you and your specific circumstances.
According to Coinbase, Bitcoin’s value has increased by 197.03 percent in the past year, even after accounting for the crypto collapses of May 19 and June 8. The total price is still nowhere near the cryptocurrency’s mid-April record highs, but it is still much higher than this time last year. Further out, the price of Bitcoin has increased by 34,381.49 percent since this time last year.
“At this time of fall, bitcoin is expected to see aid of $40,000 [ £28,316.20] if sales continue, and this key onslaught can continue to create a fresh start to a whole new high, of $70,000 [€49,555.35] in the middle to long term,” said Alexander Vasiliev, co-founder of the Mercury global payment network. Mercury.
However, Kevin Brown, a capital investment expert with Scottish Friendly, disagrees, warning against investing for anybody who does not understand the market.
“Because of the degree of volatility, those who want to invest in cryptocurrencies should be prepared to lose their whole investment,” he added.
“At the very least, if you understand the horses or football, you have a genuine chance of knowing the result and probability when you’re at the bookies.”