Cryptocurrency prices fell again over the weekend. BTC price decrease is associated with power reduction of mining in China. Due to pressure on the mining of digital currencies, it has already been banned in five provinces. This is one of the reasons why Bitcoin going down is quite a common occurrence nowadays.
BTC rate fluctuated over the weekend due to a drop in hashrate (computing power) in the Bitcoin mining network in China. Five provinces of China have banned mining centers in their territories by June 20. Bloomberg experts say that miners’ migration from China in the near future will lead to the sale of cryptocurrency reserves.
Why is Bitcoin going down? Are there any other reasons to know? Today, we’ll try to find out!
Why Is Bitcoin Going Down Today?
On Sunday, Bitcoin’s price decreased by 5.5% to $34,142. Ethereum, the second-largest cryptocurrency, fell by 5.9% to $2,095. So, why is Bitcoin going down today?
Jonathan Cheesman, head of OTC and Institutional Sales at FTX crypto derivatives exchange, linked the decrease in prices of major cryptocurrencies with the closure of mining companies in China.
Why is Bitcoin going down? Well, in recent weeks, the cryptocurrency market has been relatively stabilized. Bitcoin is trading at about half of its all-time high (around $65,000) reached in mid-April. The market value of all cryptocurrencies is around $1.45 trillion as estimated by CoinGecko, up from a high of around $2.6 trillion last month.
Why Is Bitcoin Going Down Right Now?
Still, why is Bitcoin going down right now? According to a report from Global Times newspaper, the ban on cryptocurrency mining has caused more than 90% of China’s Bitcoin mining capacity to shut down. According to the University of Cambridge, about 65% of the world’s Bitcoin mining activity took place in China.
The hashrate of the Bitcoin network has been falling steadily since June 14, after miners were ordered to shut down their activity. As a result, the whole market observes the picture of Bitcoin price going down.
Antpool, Btc.com, Binance Pool, Huobi Pool, and Btc.top have suffered significant losses in their associated hashrate. Bitcoin hashrate oscillates around 100 EH/s, which is 50% below its all-time high. Meanwhile, the authorities of other countries around the world are inviting miners to engage in mining activity with them.
This has already been stated, for example, by the Mayor of Miami Francis Suarez and the President of El Salvador Nayib Bukele. Suarez offered miners cheap power, Bukele geothermal power plants with ‘green’ energy.
Why Bitcoin Price Is Going Down?
Why Bitcoin price is going down? Are there any other reasons worth mentioning? Prior to the ban of mining in China, it became known that the American company Tesla had suspended the use of Bitcoin for purchase of its electric vehicles.
According to Musk, cryptocurrencies have a promising future, but they cannot be allowed to develop at the expense of ‘huge environmental costs’. The company isn’t going to sell its bitcoins until cryptocurrency mining is done using sustainable energy sources.
Today, many companies that considered Bitcoin as a means of payment may suspend the implementation of this initiative in an attempt to find explanations for Musk’s actions. But technologically and ideologically, everyone will continue to approach cryptocurrencies.
Will we see Bitcoin going up or down? What do you guys think? Feel free to share your thoughts in the comments!