Why the price of Bitcoin keeps falling?

in money •  7 years ago 

bitcoin, the best known digital currency in the world, falls more than 15% today, and is offered at US $ 6846 per unit, far from its record reached last December of US $ 20 thousand. According to experts, the sharp drop is due to regulatory measures and prohibitions on operations with cryptocurrencies.

According to Fortune, the five largest issuers of credit cards in the United States announced or materialized this weekend prohibiting their customers from buying bitcoins with credit cards. Bank of America activated this veto last Friday, one day before JPMorgan, while Citigroup, Discover and Capital One will also adopt these prohibitions, the publication said.

These measures are not limited to the large American banks. The British Lloyds was one of the pioneers in Europe to adopt the ban on the purchase of bitcoins with credit cards, and analysts assume that the measure will continue to expand in the sector.

The debacle in the price of the cryptocurrencies just at the moment in which they had reached greater popularity has forced the banks to adopt this measure in defense of their own interests. The digital currency boom had encouraged a significant number of customers to borrow through credit cards to increase the amount of their investments in cryptocurrencies, in order to multiply the expected profits.

The measure added to similar prohibitions applied by US financial giants such as JPMorgan Chase & Co and Citigroup in the fear that lenders could be held liable for massive losses in the event of a crash in the value of the cryptocurrency.

In fact, in the last few weeks worries have arisen in the sector after Facebook vetoed the advertisements related to the bitcoin.

In addition, India's Finance Minister Arun Jaitley said last week that the Indian government "does not consider the cryptocurrencies to be legal and will take all measures to eliminate the use of these in the financing of illegitimate activities or as part of the payment system ".

Thus, the Bitcoin lost more than 56% of its value -in dollars- from a month ago (it started the year around $ 17,000).

The year 2017 was crazy for Bitcoin. It started at just $ 1,000 and ended with its current historical record, above $ 19,000, in an upward trend that accelerated especially at the end of last November. In the middle, Bitcoin was around the same $ 7,000 that now costs - approximately - with a loss of 56.9% in just one month. In this same month, Bitcoin Cash has dropped by 63.55%, Ethereum by 28.84% and Litecoin by 54.36%.2625774h688.jpg

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