June 25, 2021

Soldering Point

technology informations

Crypto market bounces back as Elon Musk steps in with bold claim

Bitcoin has rallied after a dramatic fall last week (Credits: EPA)

Digital cryptocurrencies seem to be back on the rise following a devastating slump in value last week.

All but one cryptocurrency plummeted after China announced new measures to try and curb mining.

Bitcoin dropped 25% in value in a 24-hour period, while Ethereum and Dogecoin dropped by more than 37% in that time. By Sunday, Bitcoin had lost almost 50% of its all-time high.

Matters were compounded by Elon Musk backtracking on plans for his electric car company Tesla to accept Bitcoin as payment.

However, things appear to be looking up as Musk stepped back into the ring with a choice statements.

The billionaire initially said that Tesla would move away from Bitcoin because of the huge environmental impact involved in mining. But now he has claimed he is in talks with Bitcoin miners about possible renewable energy solutions.

At the same time, Bitcoin received an endorsement from hedge fund billionaire Ray Dalio who has also invested in the currency.

Even crazy ol’ John McAfee has got involved – calling cryptocurrency our ‘last hope for financial independence.’

Many industry analysts argue that Bitcoin’s price volatility, and the potential for crashes like this one, make it difficult to use as a reserve currency – which many proponents have earmarked it as.

The volatility was a main reason that China gave for banning cryptocurrency, and that also prove Chinese authorities right, arguing it was ‘infringing on the safety of people’s property and disrupting the normal economic and financial order’.

How did China block Bitcoin?

In this photo illustration, the  cryptocurrency electronic
China has made a move to block the use of crypto (Getty)

China, which hosts more than 75% of the world’s Bitcoin ‘mining’, where new virtual coins are minted, banned financial institutions and payment companies from providing services related to cryptocurrency transactions.

The ban covers institutions like banks and online payments channels, and includes any service involving cryptocurrency, such as registration, trading, clearing and settlement.

What is Bitcoin?

In this photo illustration the Bitcoin logo is seen on a
The bitcoin logo is seen on a smartphone screen with price in the background. (Getty)

Bitcoin is perhaps the best known type of cryptocurrency.

It works without a central bank and is usually exchanged from person-to-person when it is sold or exchanged, without anyone working in-between to overlook the transaction.

Some people like the fact that Bitcoin is not controlled by the government or banks.

It was first released in 2009 and its value has fluctuated over the last 12 years.

Only 21 million bitcoins can ever be created in order to protect the value of the bitcoin system.

Bitcoins can be ‘mined’, which is the process of actually creating bitcoins, or they can be bought using regular currency.

Bitcoins are made or ‘mined’ by computer power on the bitcoin network.

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What is bitcoin?

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MORE : Bitcoin mining in China to produce more emissions than mid-size European countries


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