The largest cryptocurrency is trading below $50,000 in a crypto market that is undergoing a correction.
Bitcoin (BTC) continues its decline after the sharp drop in its price caused by the highest year-on-year inflation data in the United States in 13 years and the announcement of the electric car company Tesla that it will stop accepting cryptocurrency as a form of payment.
Last night it had lost more than 20% of its value in hours and reached a price of $ 47,376 per unit, 18.33% less than the almost $58,000 for which it was sold at noon, its lowest price since the end of April when he had also suffered a similar fall.
This Thursday, it is still below US $50,000 and dragging other digital currencies such as Ethereum, Ripple and Dogecoin, which also fall.
The announcement by the United States Bureau of Labor Statistics (BLS) that year-on-year inflation in April was 4.2% – the highest since September 2008 – triggered expectations of a rate hike by the Federal Reserve ( FED) to stop the rise in prices, which affected the price of all assets in the financial market, both shares and cryptocurrencies.
However, the final blow for Bitcoin came when Tesla, the company chaired by the influential Elon Musk, announced that it will stop accepting BTC as a form of payment for its cars due to the high energy consumption and use of fossil fuels that mining of this uses. cryptocurrency.
“Tesla has suspended the purchase of vehicles using Bitcoin. We are concerned about the rapid increase in the use of fossil fuels for mining and Bitcoin transactions, especially coal, which has the worst level of emissions of any fuel,” said Musk himself in a statement he posted on his Twitter account.
Although he pointed out that “cryptocurrencies are a good idea on many levels and we believe they have a promising future,” he maintained that this new technology “cannot come at a great cost to the environment.”
In that sense, he pointed out that “Tesla will not sell its Bitcoins and we intend to use it for transactions as soon as more sustainable energy is used for its mining” and that the company is looking for cryptocurrencies that use “less than 1% of the energy per transaction that Bitcoin uses.”
The news caused a stampede not only in BTC, but in the entire crypto market that is undergoing a huge correction.
On April 14, Bitcoin had reached its price record by exceeding $63,700, an increase of 114% since the beginning of the year more than four times than in October 2020 when its price oscillated at $15.000 and had never exceeded $20,000.
Probably wanna read:
- Cryptocurrencies in red: Bitcoin continues to fall, Ethereum slows and Dogecoin does not rebound
- The Bank of England’s strong warning to those who invest in cryptocurrencies
- When will governments regulate bitcoin? Nobel Prize winner in economics responds