Bitcoin could stay below its all-time high of $69,000 for the next two years following the latest digital asset market rout, according to the chief executive of the world’s largest cryptocurrency exchange.
Changpeng Zhao, founder and CEO of Binance, said people would have been “very happy” four years ago if they had been told bitcoin would trade at $20,000 in 2022. The fundamental crypto asset fell below this level over the weekend in a token. move that represented a wipeout of earnings for many long-term bitcoin holders.
“I think given this price drop, from the all-time high of 68,000 to 20,000 now, it will probably take some time to come back. It will probably take a few months or a few years,” Zhao told the Guardian, adding that “no one can predict the future.”
He added: “20k we think is very low today. But you know, in 2018, 2019, if you told people that bitcoin will be 20,000 in 2022, they would be very happy. In 2018/19 bitcoin was $3,000, $6,000.
On Wednesday, bitcoin was trading at $20,491 according to CoinDesk, having hit levels not seen since late 2020 over the weekend.
When asked if he considers the current bitcoin and crypto price fluctuations to be “normal,” as he described them in an interview earlier this month, he replied, “If you look down [of bitcoin], right now it’s higher than the last peak. So whether it’s normal or not, I think the industry is still growing, price fluctuations are normal.
Bitcoin and other cryptocurrencies have been affected by several factors, including declines in stock markets linked to rising inflation and the resulting hikes in interest by central banks. Rising rates – a path taken by the US, UK and Swiss central banks last week – can make risky assets less attractive. For example, some technology stocks, the price of which may be based on strong expectations of future earnings over several decades, may be relatively less attractive than the fixed returns offered immediately by investments such as bonds, which become more attractive in an environment. higher loan rates. .
However, the woes of the crypto market have also been linked to issues specific to digital assets. Last month, the failure of terra, a so-called stablecoin whose value was supposed to be pegged to the dollar, shook faith in cryptocurrencies. It was followed last week by Celsius Network, a banking-like company that offered high rates of return on cryptocurrency deposits, stopping customer withdrawals. Then Three Arrows Capital, a hedge fund that made expensive bets on the crypto markets, admitted it was in trouble.
Zhao declined to comment on a Bloomberg report that the US financial watchdog is investigating whether Binance broke securities rules when it launched an initial coin offering – a form of fundraising for companies – from its BNB token in 2017.
“We are talking to all the regulators in the world. They send us questions, we answer them, with or without investigation,” he said.
Binance has been banned from undertaking any regulated activity in the UK by the Financial Conduct Authority, which said in June last year that the business was “not capable of being effectively supervised”.
Binance temporarily halted withdrawals last Monday due to what it called a “blocked on-chain transaction”. When asked if the withdrawal freeze was related to broader crypto market issues, Zhao replied, “I don’t think it’s pure coincidence. In market turmoil, there are more transactions on a blockchain and many blockchain nodes fail.
Cryptocurrency is the term for a group of digital assets that share the same underlying structure as bitcoin: a publicly available “blockchain” that records ownership without having the control of any central authority. A node is a device within the blockchain network that validates transactions.
When asked if the digital asset market is approaching another “crypto winter” – a phrase coined during a market decline in 2017/18 – Zhao said some projects may be in trouble as they have were designed when the market was at its most recent peak. The current value of the entire crypto market is just under $1 billion, up from around $3 billion in November last year, with bitcoin hitting an all-time high of nearly $69,000. over the same period.
“Right now, it really feels like a lot of projects are at an impasse, because once you hit an all-time high, all the projects spend money like they’re always going to be at that all-time high. So now, when it falls, it feels like winter. But for the projects that saved money, we’re still doing well, we’re still hiring, we’re still growing.
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Bitcoin Could Stay Below $69,000 Peak For Two Years, Says Binance Boss | Bitcoin – Tech Tribune France
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