The two major cryptocurrencies, Bitcoin and Ethereum, broke below the important marks of $20,000 and $1,000 respectively yesterday. Explanations for this range from pessimistic market participants to interventions against cryptocurrencies to the last interest rate hike by the US Federal Reserve. Read more about this below.
Cryptocurrencies are a controversial topic not only in hardware forums and among PC gamers, but also in large parts of society. While some are convinced of the possibility of creating money without any physical equivalent and spend huge amounts of electricity to do so, others criticize the same approach, especially given the current political background and the tense energy market. In recent months, however, the prices of the key currency Bitcoin and also the currency Ethereum, which is largely responsible for the shortage of graphics cards, have fallen sharply.
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Another psychologically important threshold was breached yesterday and prices fell sharply again. After Bitcoin had already fallen sharply at the beginning of the week, the price seemed to stabilize again over the course of the week, but in the morning the price fell by around ten percent and thus below the important $ 20,000 mark. With a price of around 19,000 US dollars, the key crypto currency is trading as low as it was last in December 2020.
The same applies in principle to Ethereum. After trading above $4,000 per ether in December, the currency has since fallen sharply and broke below $1,000 around noon yesterday. In the meantime, the course fell to 936 US dollars. Ethereum last had three-digit prices in early 2021, when graphics cards were still affordable.
Industry experts are uncertain about the current situation in the crypto market. Some are now seeing the bottom in, while others are forecasting an acceleration in the downtrends. The probability of a quick recovery is very unlikely due to pessimistic market participants and macroeconomic interventions such as the 0.75 percent increase in key interest rates by the US Federal Reserve. The key interest rate in the important US market is already in a range of 1.5-1.75 percent and is set to be raised to 3.4 percent this year in order to stop inflation.
Source: The shareholder & ARD
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