Last November was the "high point" for bitcoin prices. No one could have imagined that six months later, Bitcoin would fall off its pedestal and enter its darkest bear market cycle.
Bitcoin fell off a cliff in late May, falling below $21,000 on June 14 to its lowest level since December 2020, and is still down today.
According to media calculations, if you buy a bitcoin at the peak, the floating loss is as high as 320,000 yuan, equivalent to losing a Tesla Model3. Zhao Changpeng, known as the "richest Chinese", lost nearly 600 billion yuan in half a year.
Tesla, a prominent holder of bitcoin, lost about $530 million during the rally. El Salvador, which uses bitcoin as legal tender, is facing a huge financial risk as it has lost 55.45 percent of its bitcoin holdings.
In fact, in addition to Bitcoin, a number of cryptocurrencies are also experiencing a meltdown. Multiple analyses point out that high inflation and interest rate hikes by central banks of many countries have triggered investors' fears of economic recession, the rise of risk-off demand in financial markets, and a large amount of capital outflow from the cryptocurrency market, leading to the recent sharp decline in prices. And often after the fall of a large number of funds to try to buy the historical experience did not appear, but is biased to continue to withdraw. In the shadow of capital withdrawal, some investors have been unable to withdraw funds from some cryptocurrency exchanges recently, leading to more intense panic over the liquidity of virtual currencies.
Buffett has said Bitcoin isn't a productive asset and doesn't produce anything tangible. The market for crypto digital assets in the virtual world is often vulnerable to a crisis, and any negative event is magnified.
Indeed, the currency circle is risky and investment needs to be cautious. Consumers should enhance risk awareness, not participate in virtual currency trading speculation activities, not blindly follow the trend of virtual currency speculation, beware of personal property and rights and interests damage.