The biggest fall in virtual currencies and external events leaves an analysis of the coming months.
It’s been a rough few weeks for cryptocurrencies. Days in which Warren Buffet fans have enjoyed watching investors’ money disappear from the beginning of May, when Bitcoin was trading at 37,000 euros, until June 18, when it bottomed out at 18,000 euros.
The fever of investing in digital currencies such as Bitcoin or Ethereum has suffered a major correction these weeks and has forced investors to recompose their portfolios and their ideas. They have learned how this currency works, that it has no network in the face of the crisis, and what external factors affect it. Something like the dollar and gold, which always fluctuate against each other.
Tesla
The last corrective movement has been that of Tesla. Elon Musk is a fan of the crypto world, but it has been known that the company sold 75% of the investment in Bitcoin. At the time he bought 1,500 million dollars and now he only has 218.
Although the movement may affect the price, people will have to read beyond the operation to understand how Musk has limited his investment in view of the extremely high volatility of these digital currencies.
The tough weeks have also cost businesses like Celsius, Three Arrows, and Voyager, which have gone bankrupt. Their numbers have prevented customers from withdrawing their money while they stabilize or liquidate their business. Another rectification that causes other companies in this sector to protect themselves thanks to lifelong entities.
Bank of Spain
The Bank of Spain has recognized the Bit2Me platform and will soon do so with others such as Coinbase or Binance, this is limited to advertising control, but the CNMV will have to monitor them closely.
Electronic wallets, rental benefits or currency exchange are also beginning to be regulated. It is true that many regulations are made in order to prevent money laundering and the financing of terrorism, but it is another step to give investors some security.
Fall of Luna
Europe is trying to launch a digital currency, a guaranteed currency that will never lose all its value as happened with Luna in the middle of the May 2022 crisis, although it is now trading at 1.80 euros.
The economic maturity of this currency has suffered a hard time in its learning curve. The markets begin to know that inflation, instabilities, wars, and other factors also take it to the abyss or put it at the top.
Experts still feel uncertain about the future. The cryptocurrency market is extremely unstable, as it is only speculative. It is possible that the next crypto winter will take away some virtual currencies forever.
By Audy Castaneda
