According to the reports, the price of Bitcoin fell significantly over the past few hours. Cryptocurrencies prices witnessed a sell-off today with Bitcoin falling 8% to trade below the $34,000 level. Additionally, other digital coins like ether and dogecoin also plunged in the last 24 hours. As a result of the plummeting cryptocurrency prices, the whole crypto market tumbled downwards. According to the reports, Ethereum, Dogecoin, Cardano, BNB saw a fall in prices from 5 to 10 per cent. It is to be noted that this fall in price was sudden and unexpected. The price shock comes after Bitcoin had been comfortably trading in the $35k-40k bracket over the past week.
To state that the crypto price crash was unreasonable would be a mistake. There was reportedly one big factor that had directly contributed to the small crypto crash that wiped out 5-10 per cent net worth from major cryptocurrencies overnight. It might come as a shock to many but Elon Musk, this time, did not play any role in the plummeting prices of cryptocurrency but it was the former president of the US—Donald Trump.
Former US President Donald Trump, appearing in an interview on the Fox Business Network, stated that Bitcoin “seems like a scam”. He further went on to state that he dislikes Bitcoin because he thinks of it as another currency competing against the dollar. Adding to his crypto rant, he went on to add that he positively wants the dollar to be the universal currency of the world. Thus, to state that the former President of the US words still hold sway in the market, would be absolutely correct.
According to the reports, soon after his interview was aired, the price of Bitcoin dropped down more than 7 per cent in just a few hours.
According to CoinDesk data, Bitcoin price was trading at $33,663.43, which was down by 8%. On the other hand, Ethereum declined by 7% to $2,595, while Dogecoin tumbled around 10% trading at $0.33. Other cryptocurrencies like XRP, Litecoin also contributed to the fall as they fell by more than 10% in the last 24 hours.
In the week that ended on June 4, Bitcoin outflows had hit $141 million. It emphatically represented the 8.3% of the net inflows seen this year. According to the digital currency manager CoinShares, for the year so far, bitcoin has still showed net inflows of $4.2 billion. Digital asset product weekly trading volume on bitcoin has fallen 62% compared with last month.
The data showed that the cryptocurrency sector overall suffered outflows of $94.2 million last week. On the other hand, it is to be noted that Ether, the token used for the Ethereum blockchain, continued to see inflows of $33 million this week.
Last week, Bitcoin funds and products posted record outflows. This was due to the fact that investors continued to cast a cautious eye on the world’s largest cryptocurrency, which has seen its upward momentum stall in the last few months.
As has been previously reported, a slew of crypto accounts on China’s Twitter-like Weibo platform were blocked over the weekend by the platform authorities. The stringent step was taken as Beijing had stepped up its crackdown on bitcoin trading and mining.
Consequentially, over the weekend, access to several of widely followed crypto-related Weibo accounts was deleted. A message stating “violates laws and rules.” was circulated among the users. The Weibo freeze comes as Chinese media have stepped up reporting against crypto trading. The stepped-up crackdown also comes as China’s central bank is accelerating testing of its own digital currency
But it would be too shortsighted to state that the downfall of the crypto markets wasn’t initiated by the Tesla CEO Elon Musk. The crypto price fall had started early in May when Elon Musk had announced on Twitter that Tesla would stop accepting payments in Bitcoin. Throughout the next week, Elon Musk reportedly had continued to bash Bitcoin, calling it bad for the environment.
Additionally, factoring out China’s role in the crypto market wouldn’t be justified either. The crypto market has been experiencing one of the biggest dips in years after China reinforced their ban on crypto exchanges and made Bitcoin mining illegal on May 19. Since then the price of Bitcoin has fluctuated on a downwards trajectory. To top it all, Trump’s latest announcement caused more fear in the markets which lead to the steep fall in price. Thus it can be rightfully stated that crypto markets are emotionally driven and volatile and could jump either way very soon.