The price of Bitcoin has fallen these past few days to its lowest value in months. The plummeting of this cryptocurrency comes after the U.S. Federal Reserve tightened its policy on these assets and suggested increasing Bitcoin interest rates. At the beginning of last week, the Bitcoin price was at $47,000, and by the end of last week it had dropped below $42,000.
Bitcoin price has plummeted by just over $5,000 in less than a week
There are other factors behind the rapid decline in the Bitcoin price last week. These include the citizens’ revolts against the government of Kazakhstan, one of the countries where much of the world’s cryptocurrency mining is concentratedwhich have sown uncertainty and distrust among investors.
After China began to prosecute and punish the mining and possession of cryptocurrencies early last year, much of miners moved to neighboring Kazakhstan to pursue the activity. In just over a year, this Asian country went from mining just 1.5% of all the world’s cryptocurrencies to producing 18.1% by the end of 2021. Only the United States, with a market share of 35.40%, surpassed Kazakhstan in this ranking.
It is estimated that, in Kazakhstan as a whole, there are 250,000 active computers mining cryptocurrencies. The excessive energy consumption of this activity has brought the country’s electricity system to the brink of collapse. According to the Kazakh energy minister, electricity consumption has grown by 7% in the last year, when the usual increase in the country is around 2%.
Due to its global and decentralized nature, Bitcoin and the other cryptocurrencies frequently accuse very deep convulsions in their price. Bitcoin is the oldest blockchain on the market, having just this week celebrated its 13th year in business. Despite its volatility, many investors in the industry consider it a haven of value because of its relative stability compared to its competitors.
