Concerns regarding the legitimacy of cryptocurrencies such as Bitcoin have grown. Many well-known people have expressed their reservations regarding digital currency. Cryptocurrencies are “based on nothing,” according to European Central Bank President Christine Lagarde, and should be regulated to protect people from staking their life savings on them. Earlier this week, the Bank of England’s deputy governor suggested that some regular individuals who had invested in digital currencies were likely unaware of what they had bought or the risks involved.
Bitcoin has more than halved to $30,000 in the past seven months, Forbes data shows. An uptick in borrowing costs is generally bearish for emerging technologies like Bitcoin. The minutes of the Federal Reserve’s (Fed) May policy meeting, released on May 25 at 11:30 p.m. (India time), could have a detrimental impact on the future price of Bitcoin and other digital assets, according to Forbes.
The perils of loosely regulated cryptocurrencies and stablecoins, which skyrocketed in value during the COVID-19 pandemic, have been brought into sharp relief, with the cryptocurrency market plummeting this month following the demise of key stablecoin terraUSD. Bitcoin, the most popular cryptocurrency, has lost more than 50% since November.
The cryptocurrency economy has been ripped to shreds in recent weeks, with the sector’s value plummeting by hundreds of billions of dollars and several currencies entirely collapsing. The scamming industry, estimated to be worth $7.8 billion last year by Chainalysis, has not given up. Scammers continue to find fertile ground on Telegram and Twitter, posing as humanitarian heroes assisting those who have suffered losses as a result of the catastrophe. The explanation capitalises on the cult-like character of cryptocurrency investing, but experts believe this is far from the case.
A widespread conspiracy theory claims that investment firms such as BlackRock and Citadel planned the crypto meltdown. According to one view, these corporations purposefully crashed Bitcoin in order to acquire into the space at a lower price.
(With agency inputs)