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Bitcoin: the price falls sharply without erasing the gains of 2020

Bitcoin

Bitcoin experienced a heavy fall on Monday, dropping from a high of 34,135 euros on January 8 to a low of 22,500 euros in the first exchanges on Monday. Since then, the very volatile price of the cryptocurrency has stabilized around 30,000 euros, a drop of 11% which does not however erase the exceptional gains of the year 2020.

Bitcoin
Credit: Unsplash

Throughout 2020, the price of Bitcoin has generally benefited from the global pandemic and slowing economies. Its price has more than quadrupled during the year 2020, going from 7,900 euros at the start of January to more than 34,000 euros (or $ 40,000) last Friday. But it seems since Monday that the course has started to fall.

In the first exchanges on Monday, the price of the cryptocurrency even suffered a mini-crash, falling to only 22,500 euros before quickly recovering – either a drop of 34% all the same. At the time of this writing, the price of Bitcoin has recovered. A unit trades around 30,000 euros which contains the fall around 11%.

Bitcoin: the price keeps nearly 300% of progression since January 2020

Since early 2020 the gains – almost 300% – are therefore still far from being erased. It must be said that the situation lends itself rather well to the growth of this type of very high-risk asset: central banks provide abundant liquidity, and less incentive for investors to turn to safer investments because of interest rates. particularly low interest.

This high volatility has made institutional players react once again, who regularly try to make consumers aware of the risks of this type of investment. This is particularly the case of the British financial market regulator FCA, cited by our colleagues from Le Figaro: if consumers invest (in cryptocurrencies), they should be prepared to lose all of their money.

Also Read: Trump Tries To Destroy Bitcoin In Final Days As President

It is indeed a real risk with this type of investment, the price of which varies greatly: in the event of a crash, or an investment at the wrong level of the share price, you can lose almost everything. It remains to be seen to what extent this is really riskier than building a portfolio on the stock market.

Source: Le Figaro