Did you know the reality behind the Bitcoin crash down?

According to many, the fall of Bitcoin generates by two different factors: The influencer Elon Musk and the Government of China.

First, Elon Musk of Tesla, announced that his company will stop accepting payments with that cryptocurrency due to its environmental impact. He showed his concern about the increasing use of fossil fuels.  He mentioned the coal to generate the energy required by mining bitcoins.

Second, this market drop is because China has prohibited financial institutions from using cryptocurrencies. You can see that the fall started in the hours of the Chinese market! When many from other countries saw the drop, they also started selling. The entire market was down more than 40%.

What are the reasons why china prevents Bitcoin transactions?

Reason #1: “They are not true currencies”

“China dug into the wound by stating that virtual currencies should not and cannot be used in the market because they are not real currencies,” said Fawad Razaqzada, an analyst at ThinkMarkets.

Lastly, several leading Chinese banking federations considered cryptocurrencies “not true currencies.” They warned of the danger of “speculation”, in a country that is preparing its digital currency.

China was for a time one of the strongholds of the bitcoin, the most widespread virtual coin.

Reason #2: Bitcoin can use for criminal activities

However, in 2019 Beijing took a radical turn and declared cryptocurrency payments illegal in the country, accusing them of serving criminal activities. The country was concerned about the speculative risk that cryptocurrencies could pose to its financial structure and social stability.

Experts have commented that China tends to have a desire to ban everything that represents freedom. The Chinese government wants to restrict the use of cryptocurrencies and put the digital yuan in its place. It is a digital currency backed by the central bank of China.

Remember that most of the miners are in China! The demand is still there to mine. Someone else will take over!

To the doubts generated in recent days by the statements of the founder of Tesla, Elon Musk, we now add the position of the People’s Bank of China, not to accept digital “tokens” as a form of payment.

What is behind China’s decision?

The recent announcement that the Chinese digital currency has entered a testing phase and the expectation to be fully operational shortly reignites the debate on the future of the international monetary and financial system. The news links to the recurring forecasts until now frustrated, of the imminent fall of the global power of the United States and its currency, the dollar, as the unique international currency. In this case also about the possibilities that new technologies revolutionize the very nature of the currency.

Now, the question is: What is the future of bitcoin after the crash down? See the answer in this article.