BITCOIN NO SUBSTITUTE FOR MONEY
Bitcoin’s drop was triggered by China’s efforts to crack down on mining and trading of cryptocurrencies and weighed by Tesla suspending its willingness to accept it as payment due to environmental concerns about energy use..
The U.S. Treasury Department has also called for requiring large cryptocurrency transfers to be reported to the Internal Revenue Service and the Federal Reserve flagged the risks cryptocurrencies posed to financial stability.
“It is not a substitute for money,” Vishnu Varathan, head of economics and strategy at Mizuho Bank, told the Global Markets Forum chatroom on Refinitiv Eikon.
“At best (it) is an alternative asset, albeit one without intrinsic value,” he said, adding that blockchain technology and its potential “must not be conflated with crypto-currencies”.
Such nagging doubts have kept bitcoin from closing above its 200-day moving average since it collapsed to hit last week’s four-month low around $30,000. This week it has been supported around $37,000 but forged no higher than $40,904, while ether, which hit $1,730 last weekend, has attracted buyers above $2,500.