Bitcoin investors are once again focusing their attention on the $40k threshold. Because if it falls below this level, the price of the currency capit
The total market capitalization of Bitcoin has not yet returned to the $800 billion threshold.

The total market capitalization of Bitcoin has not yet returned to the $800 billion threshold. Compared to the record high of $68,700 per coin set on November 10, Bitcoin has dropped by nearly 40% in price.

“Bitcoin prices fell along with other risk assets as interest rates and energy costs continued to rise this week,” commented Edward Moya, a financial expert at consulting firm Oanda (based in London). with Zing.

Important threshold 40,000 USD

Bitcoin is considered by many as a form of "digital gold", which will benefit in an uncertain economic and financial environment. However, according to observers, cryptocurrencies now behave more like risk assets. Therefore, when interest rates rise, the opportunity cost of holding Bitcoin increases, which in turn drives investors to sell off.

“Bitcoin price continues to plunge. The currency seems to be more vulnerable to not being able to bounce back strongly from recent lows,” said Craig Erlam (London-based) financial expert.

“Price recovered somewhat last week, but quickly encountered resistance at $45,000” he commented.

According to the expert, all investors are focusing their attention on the important level of 40,000 USD/VND. Because if it falls below this level, the Bitcoin price could see an even sharper drop.

“If easing monetary policy has been one of the main ‘catalysts’ that have helped Bitcoin boom over the past two years, then the crypto world could enter a more difficult 2022. By central banks. Central banks around the world, including the US Federal Reserve, are moving into tightening mode," Erlam argued.

“It is very difficult to predict the price of Bitcoin in the short term, especially when the market becomes more negative,” he commented. According to the expert, Bitcoin has ceased to function as a safe-haven asset.

“Cryptocurrencies are likely to continue to come under pressure as the Fed reduces the amount of money injected into the economy,” said Jay Hatfield, CEO of Infrastructure Capital Advisors.

"Bitcoin price could end 2022 below $20,000" the expert warned.

Finance professor Carol Alexander at the University of Sussex even warned that the price of Bitcoin will fall to the threshold of 10,000 USD by 2022, erasing all gains in the past 2 years.

Tighten control

According to Oanda expert Moya, the Kosovo ban on cryptocurrency mining is also bad news for Bitcoin and other cryptocurrencies. The Kosovo government's ban is intended to defuse the country's energy crisis.

After Kosovo's announcement, Bitcoin miners had to sell off mining equipment. “They sell devices or try to move to neighboring countries,” CryptoKapo, the administrator of some of the largest crypto communities in the region, told The Guardian.

Previously, Bitcoin miners targeted Kosovo because it has the cheapest electricity in Europe, partly because more than 90% of electricity in the country comes from burning lignite reserves and subsidizing the government.

In recent years, the number of cryptocurrency miners in Kosovo has skyrocketed. Groups like Albanian Crypto Amateurs on Facebook, Crypto Eagles on Telegram explode with thousands of new members.

According to the latest Cambridge University calculations, Bitcoin mining globally consumes 125.96 terawatt-hours of electricity per year, surpassing Norway (122.2 TWh), Argentina (121 TWh), the Netherlands (108). 0.8 TWh) and the United Arab Emirates (113.20 TWh).

Meanwhile, Kosovo is facing an energy crisis. Power outages occurred continuously across the country in the last days of 2021. At the height of the crisis, the country had to import about 40% of its energy from the international market.

In April, the Bitcoin price also plunged from its peak after the Chinese authorities tightened controls on Bitcoin mining and trading.

“Ether prices also fell as crypto investors looked to diversify their portfolios,” explained Moya at Oanda. “They are not only investing in the top cryptocurrencies, but also paying attention to alternative cryptocurrencies that are in the growth phase,” he added.

According to him, Cardano, Solana and Terra are all on the upswing. The price of Ether - the world's second largest cryptocurrency - saw a decrease of 2.64% from 24 hours earlier to $3,000 per coin. Over the past seven days, the coin has lost nearly 6% in value.

Meanwhile, Terra - the world's sixth largest cryptocurrency - saw a 5.56% increase from a day earlier to $79.49 per coin.

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