Are the statements of the Chinese authorities and Elon Musk the fundamental basis for the wholesale price reduction of the main types cryptocurrencies (Bitcoin, Ethereum), which happened over the past week?
If everyone is more or less skeptical about Mask's stuffing, after his versatile positions regarding the crypt, then the statements of three Chinese associations affiliated with the People's Bank of China, namely: the Internet Finance Association, the Banking Association of China and the Payment Clearing Association, relative to the fact that domestic companies are prohibited to maintain monetary and settlement relations related to cryptocurrencies, the market reacted instantly – the decline in four days was more than 50%.
Of course, the absence and direct rejection of state regulation of the crypt in China (the second country in the world by nominal GDP, a country with a leading position in terms of consumption within the republic, foreign trade, as well as investment volumes) is a serious argument for reducing its liquidity.
However, why did most crypto owners decide that these decisions could devalue it in an instant by as much as 50%. The law of the market, overbought? Or is it still not the majority, but several large institutional owners who have the largest number of these assets?
Let's give an example, also gold. Monetary settlement operations with precious metals are also not allowed between residents of China. However, the global value of gold does not decrease from this relative to such statements. Today, the fall in the price of gold is mainly due to factors that have a positive impact on the US dollar itself (its economy) and forcing investors to exit low-risk assets, which in fact is gold into riskier ones - the dollar. But again - for the time being !
With a high degree of probability, given high potential of the crypt (Bitcoin, Ethereum), it can be assumed that someone is interested in this artificial price reduction, especially against the background of such statements from China regarding the regulation and mining of cryptocurrencies. The release of a large number of liquid cryptocurrencies for sale today may well allow them to provide a more attractive (low price) for the same assets in a larger volume, already in the near future.
In conclusion, one thing can be said, no statements (even from China) will be able to deprive those basic advantages of the crypt, which are inherent only to it (even as a monetary unit), efficiency, fairness, security.
Everything is going to the fact that against the background of fear and fears of small stock traders, the weak will give their coins to the strong, and the value of the crypt will come to its natural level already when those who started this artificial fall will enter the game again.
Artificial fall of the crypt – is there a reason for the decline – Something like that!
