The fact that the prices of cryptocurrencies are volatile is certainly not a new finding.
But as is often the case, enthusiasm for new technology leads to the belief that it is only the necessary accompaniment to an endless success story.
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At the moment, however, the crypto market gives the impression that the shame has occurred. The price of the best-known, most important and weighty crypto investment Bitcoin has now fallen by almost half since its high of 63,531 dollars - and that within less than two months. That makes a minus of a little less than 99 percent over the year.
A Bitcoin currently costs around $ 33,000 and is struggling not to drop below the late May low of $ 32,280 or even below the January low of $ 30,558.
Then technically the way to $ 20,000 would be open.
And especially in the crypto market, many investors pay attention to technical factors - what else should they look out for?
There are only rudiments of fundamental conditions.
Neil Wilson, senior market analyst at the derivatives trader markets.com - no one who would be considered very conservative - sums it up as follows: Bitcoin is not a currency, just a monstrous speculation.
For almost every use, Bitcoin has to be exchanged back into conventional currency.
He couldn't look at it any other way than a kind of senseless digital gold.
The gold that is not gold
A tip against crypto fans. After Bitcoin was not really successful as a means of payment and is also less practical than claimed - because small transactions in industrialized countries in particular are often too expensive for this - they discovered the analogy to raw materials, especially gold. Bitcoin's essential function, like that of the precious metal, is that of a store of value, because neither can be increased at will. Several things were deliberately overlooked. Gold has earned its trust over millennia and served as the basis of paper currencies for almost a century. Its price is significantly less volatile, and even if it sounds clichéd: As long as Indian weddings are not virtual, Bitcoin will not replace gold as a gift.
Is that the end of Bitcoin and crypto systems?
Not at all.
It starts with the fact that the Bitcoin exchange rate also showed pronounced cycles in the past.
It is now the sixth.
And every time the price at the end of the downward phase was well above the starting level.
And Bitcoin is still miles away from this at 4904 dollars.
In addition, one should be careful not to equate price development and technical value.
The untraceable pursued
What burdens Bitcoin is not so much the critical tweets from Tesla boss Elon Musk, but rather certain disenchantment tendencies in which these play a role. Not to be underestimated is the news that American investigators were able to find almost all of the extortion money paid in Bitcoin from the latest hacker attack on the oil pipeline operator Colonial. The fact that they were able to pursue and seize the untraceable could undermine the argument of the libertarian, politically uncontrollable currency, said Jeffrey Halley, chief market analyst at broker Oanda.
The distancing of Musk and China, which was understood as a bitcoin and crypto advocate, outweighs the fact that little El Salvador is now planning to introduce Bitcoin as a parallel currency or that the software manufacturer Microstrategy has issued a 400 million dollar bond to buy more Bitcoin embarks. The company recently posted a loss of $ 285 million due to the volatile Bitcoin price, writes Wilson. It apparently depends on the rate staying above $ 24,000.
This also shows that the rumored interest of institutional investors used as an argument for the non-speculative character of Bitcoin investments is only of limited use. The risk appetite is also very different among these. If it weren't for it, the financial crisis caused by insubstantial mortgage bonds would not have occurred a good 13 years ago. And of course, those who are willing to take higher risks always buy first. No matter how high and how much the commitment of institutional investors actually is, the crypto markets are essentially determined by private investors. Usually, the life cycle is designed in such a way that these investors initially drive the valuation of an asset class into the sheer endlessness, while the professionals hold back. Then the market collapsesso the hour strikes again. Volatility goes down and valuation becomes more realistic.
In terms of Bitcoin, however, this is a bit difficult as long as there are deficits in practical application. Some other cryptocurrencies such as Ethereum, which is often used in connection with blockchain-based investments, have an advantage. The Ether course has developed significantly better since the beginning of the year. While Ether can still record a plus of 240 percent, Bitcoin is only just under 16 percent.