Due to investors’ continued caution over recession fears, the price of bitcoin and other cryptocurrencies has fluctuated recently. BTC briefly climbed back above $20,000 on Monday, but the bulls’ hold is eroding.
The largest cryptocurrency in the world briefly fell below the $20,000 mark, which is mostly symbolic as it enters a difficult winter.
The Economic Daily, a state-run media outlet in China, has been alerting investors that the current financial crisis could cause the price of bitcoin to drop to zero.
Going to zero for Bitcoin?
Digital assets have had a turbulent recent period. While some companies, like Gemini and Coinbase, have made personnel reductions to deal with the tough times, cryptocurrency firms Celsius, Babel Finance, and Three Arrows are edging closer to bankruptcy.
Bitcoin lost 6.09 percent of its value in the last day to hover at $20,129 in a new sell-off on Wednesday, while Ethereum lost more than 7 percent. The market capitalization of all cryptocurrencies as a whole is at $912 billion, up 1.88 percent today. That’s noticeably down from just seven months ago, when the market capitalization of cryptocurrencies reached $3 trillion.
The Economic Daily predicts that the current bear market will only become worse. The bellwether cryptocurrency, according to the media controlled by the Chinese Communist Party, has no intrinsic value and will ultimately lose all of its value as investors lose faith in it and more sovereign governments ban it, according to the South China Morning Post.
The Beijing government outlet also thinks that “manipulation and pseudo-technology concepts” abound in the cryptocurrency business. The most recent warning is a reflection of the Chinese government’s adamant opposition to cryptocurrency. In May 2021, the country outlawed all bitcoin mining, which caused miners to flee in large numbers for more welcoming jurisdictions.
Along with mining, all cryptocurrency-related transactions were deemed illegal by China’s leading national financial and technological government entities. But the outright prohibition on decentralized technology has failed.
The country’s mining business survived the ban on bitcoin mining, which once caused a 50% decline in the hash rate throughout the whole BTC network. Surprisingly (or not, depending on who you ask), China is once again the second-largest contributor to the BTC mining network after the United States as underground mining activities expand.
