No other digital currency can match the volatility of bitcoins as its value goes through the fluctuations regularly. The strange thing is that the changes in its value can occur at any point without being notified to the investors. This is the only reason that people sometimes face an enormous loss when there is a fall in the value of bitcoins. The same kind of situation had occurred with the bitcoins in recent times as some tweets and global programs affected the value of bitcoin on May 19, and it was down by almost 30 %. Actually, Elon Musk, who owns Tesla, announced about not accepting the payments in the form of bitcoin by its Tesla company.
In the tweet, when hit in the market, the tremendous disturbance was noticed, which created a sense of worry and fear among the investors. The investors were mainly shocked because Elon musk had invested almost $1.5 billion to get bitcoins in the month of February 2021. But now, he mentioned that bitcoin mining and its transactions utilize a high level of fossil fuels which cause severe damage to the environment.
What happened to the market after this announcement?
The entire crypto market faced a downfall as soon as the announcement by Elon Musk hit the market. The worst thing is that decline in the rate of bitcoin affected the value of other currencies, which mainly includes Ethereum, Dogecoins, and Ripple. As the experts were able to make pre-market predictions, this was not possible for them. Even they did not understand how a single tweet can bring a storm in cryptocurrencies on the Bitcoin trading. The analysts also mentioned that this was a much-needed fall in the value of bitcoins, and market correction will take place, and everything will become normal.
The fluctuations in the value of the bitcoins are a regular thing, but this time the effect has resulted in something terrible. Within a very few times of fall, the 30% fall in the value of the bitcoin has resulted, which is really a considerable fluctuation after the fall in the value of bitcoin that occurred in 2018. But the tweet by Musk has to lead to the loss of investors, which was finally getting recovered, and China made the announcement. China has once again implied ban on the some of the financial agencies to not conduct the transaction that involves bitcoin. This fall in the value has disturbed every investor, which is the only reason they are stepping back as they claim that it is not possible for them to face a loss beyond this.
After few hours of decline, the market finally started its correction. The crypto market does not require any kind of strategic push to go through revision. It will automatically get recovered without including any type of technique, so the investors are not required to get worried. The digital currency reached the lowest mark of $31,926, which had disappointed the investors who have paid such an abundant amount to invest in the bitcoins a few weeks ago. Within 24hours of decline, the value of bitcoins started its recovery and raised to $38,136. Even the other digital currencies affected by this fall have also recovered and are still going through the same.
China is the only country in the world with a vast number of investors who perform bitcoin mining regularly. Even new and new users are switching to the use of bitcoin, which is creating an issue for China’s Central bank. It is because there has been a decline in the use of their financial system, and a significant proportion of transactions includes the transfers related to bitcoins and various other cryptocurrencies. It is a new try of China to create hindrance for the users so that they will face difficulty in accessing their value bitcoins. The effect of this ban stayed for few days as within that time; arrangements were made so that users can continue accessing their bitcoins.
No one should get worried by noticing the downfall in the bitcoins because they are formally based on buying and selling nature of the investors. Whenever the fall in the crypto market is desired, the selling of a considerable high proportion on holding makes up the decision of releasing their bitcoin, which leads to loss for the small investors.