Bitcoin hit an 18 month low sinking hundreds of billions of dollars

NEW YORK : (WebDesk)  The value of the digital currency bitcoin fell to an 18month low. According to the news website Pro Pakistani the value of bitcoin has dropped dramatically by 12% bringing its value to  23,619.

According to the report after this recent decline the price of bitcoin has come down below 24 24,000 for the first time since December 2020. The depreciation of the bitcoin has reportedly cost the crypto market more than 200 200 billion. After this loss the total market capitalization has fallen to 1 trillion dollars for the 1st time since February 2021.

Bitcoin hit an 18 month low sinking hundreds of billions of dollars
Bitcoin hit an 18 month low sinking hundreds of billions of dollars

The sharp decline in market is not much of a surprise when we see a growing correlation between traditional stocks that have recently declined & cryptocurrency market over the past few years said Walt Kodmani chief market analyst at XTB. Have seen the link

The value of the world most famous cryptocurrency fell by almost 10% in morning deals in London after which it reached 23 23,794, the last time it reached this level was in December 2020.

Virtual unit fell to 65% after hitting a record high in November 2021.

On Monday, investors sought some security measures from United States US Federal Reserve which could lead to higher borrowing costs to offset rising inflation.

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Total market capitalization in November 2021 was over  3 trillion. It is being reported that the price of bitcoin has declined due to the rise in inflation in the US  United States & the possibility of an increase in interest rates by the US United State  Federal Reserve this week.

Buy borrow or exchange cryptocurrency & make a profit.

These are the services provided to its users by a platform called Celsius which is considered a major player in world of digital currency.

But last Sunday the company decided to freeze the accounts of 1.7 million customers in view of the market situation.

The decision dubbed Correlato by cryptocurrency experts triggered a downward trend in the prices of the 2 major currencies bitcoin & etherium which has continued ever since.

Term correlative is commonly used to refer to economic decisions when money is available but not allowed to be used. It all started with decision of Argentina in 2001 when the government banned the withdrawal of money from the bank.

Ellis Liu a senior associate at Wisdom Tree Firm said the crypto market was uncertain earlier this year due to rising interest rates inflation & a downturn in global markets.

It should be noted that the price of bitcoin has decreased by about 50% while the price of etherium has decreased by more than 60%.

Experts believe that this has had a negative impact on other digital currencies & reduced their value which has put other cryptocurrency platforms in a difficult position.

What happened cryptocurrency Bitcoin

On Sunday Celsius own digital currency the CEL began to plummet & that's where  issue began.

As CEL value plummeted, the Celsius firm decided to impose a ban on consumers removing the ability to withdraw transfer or convert cryptocurrencies from one account.

Firm did not elaborate on how long the facilities would be closed.

Celsius decision also affected Binance the world largest cryptocurrency exchange platform & forced it to suspend bitcoin issuance for several hours.

According to the Celsius company which has offices in the United States UK  United Kingdom & Lithuania the decision to freeze the account was made in the best interests of consumers so that steps could be taken to protect their assets.

It should be noted that in just 1 year value of Celsius company currency has dropped from seven US dollars to zero point twenty dollars.

Celsius system rewards its customers with high interest rates for keeping cryptocurrencies in the network.

This means that if a bitcoin holder stores his currency on the Celsius platform he will be rewarded in return. In return the user agrees not to make any transaction with his currency.

In general the longer a person keeps his digital currency in store the greater the reward. On the other hand consumer currency is used through blockchain.

It is like a system where one puts one money in a savings account in a bank. The only difference is that unlike the banking system there is no legal protection in  digital world.

According to Celsius website the company pays interest at 7% on currencies such as USDC and Tether 7.25% on polygon 6% on etherium and 6.25% on bitcoin.

Given the market conditions & interest rates no ordinary bank in the world can offer such a profit.

Following the recent decision Celsius has announced that customers will continue to receive rewards while the account is frozen.

In the wake of these events Gary Jensler chairman of the SEC America largest economic regulator has warned against profiteering promises that may seem impossible to keep true.

In today world how can anyone promise to make such a profit without providing complete information?

Earlier in March 3 European economic authorities warned consumers that cryptocurrency businesses were at risk & that their use as an investment or transaction would not benefit most people.