It’s no secret that cryptocurrency isn’t exactly what one would call a stable investment. Bitcoin in particular can turn on a dime in terms of its value, though it was having a pretty bumper year until this month. Now, if things keep going the way they are, the crytpo-coin might see its worst month since 2011.
Bitcoin blues
Bitcoin dropped down to its lowest this week on Friday, the 28th of May, says TechCentral. The cryptocurrency has lost 37% in value over this month, and if it continues to dip it’ll drop below its previous lowest point, which was back in September 2011.
Currently, Bitcoin is trading in the range of $34,000 and $40,000, in what crypto hedge fund ARK36 executive director Ulrik Lykke calls a “slumber mode”.
So what’s got Bitcoin feeling down? Well, it’s common knowledge at this point that Elon Musk is a huge proponent of the virtual coin, and his support for it has been an important factor in directing its value. Recently, however, Musk and EV automaker Tesla u-turned on the decision to let customers buy cars using the cryptocurrency. Musk, in a tweet, explained that while he believed in crypto as a good idea for the future, mining it was simply too dependent on fossil fuels and therefore costly for the environment for his sustainability-minded company to support.
Additionally, China has recently cracked down on crypto and crypto mining, citing both legal and environmental concerns. This is undoubtedly a contributing factor, as most of the world’s bitcoin is mined in China. Bitcoin is an unusual entity, however, and this current slump is likely only temporary. We (and most of its proponents, probably) are expecting the cryptocurrency to bounce back sooner rather than later.