- The digital coin fell by as much as 9% towards $41,000
Cryptocurrency bitcoin slammed into reverse a day after topping $45,000 for the first time in nearly two years.
The digital coin fell by as much as 9 per cent towards $41,000 in a stark reminder to investors of the risks that are involved when betting on cryptocurrencies.
The slump came a day after bitcoin shot past $45,000 for the first time since April 2022 on hopes that there would be a big regulatory breakthrough.
In reverse: Cryptocurrency bitcoin slammed into reverse a day after topping $45,000
Speculation is mounting that the US Securities and Exchange Commission (SEC) will approve the first-ever exchange-traded funds (ETFs) tied to crypto in the coming days.
That would give the industry, which was dubbed the ‘Wild West’ by SEC chairman Gary Gensler just last month, a much-needed credibility boost.
However, analysts have warned that the value of bitcoin will crash if the ETFs are not approved.
Neil Wilson, chief market analyst at Markets, said the recent surge in the value of bitcoin may be nothing more than ‘hype and enthusiasm for something that everyone has told themselves must have some kind of value’.
Bitcoin rocketed to a peak close to $70,000 in 2021, having been worth less than $500 five years earlier.
It then crashed below $16,000 in 2022 before staging a recovery last year.
Regulators in the UK have warned investors who buy crypto assets such as bitcoin that they are highly risky and they could lose all their money.