Bitcoin is the prima donna cryptocurrency and its value has continued to soar in recent years. However, recently, the value of Bitcoin continues to fall, even to half of its original point.
In November 2021, the value of Bitcoin had broken through at USD 64 thousand and seemed unstoppable. But right now, its value had fallen by more than 50%. Had been at the point of USD 26 thousand, currently Bitcoin is difficult to reach more than USD 30 thousand.
The collapse of Bitcoin and other digital currencies is said to be related to high inflation and interest rates in the United States and other parts of the world. But still there is a wonder why Bitcoin, which is the prima donna, continues to fall in value.
Regarding this, Damanick Dantes as investor and crypto market analyst at CoinDesk stated that Bitcoin price dynamics are similar to technology company stocks that fluctuate rapidly.
In other words, putting hope in investing in Bitcoin today is not much different from buying stock in a technology company that may have a lot of long-term potential, but its short-term value is unclear.
However, the occurrence of growth in such assets is usually triggered by conditions that are sometimes correlated with low interest rates. But when interest rates rise as they are today and investors are no longer willing to take risks, then a massive sell-off of Bitcoin is inevitable.
"Investors and traders today are looking for stability, areas of high quality value. That's the complete opposite of assets like Bitcoin," Dantes said as quoted by ABC News, Tuesday (17/5/2022).
