Last week we saw a sharp selloff in crypto after authorities in China and the US moved to tighten regulation and tax compliance of cryptocurrencies. Bitcoin fell as much as 30% in one day, nearing $30,000, having reached a peak in April near $65,000. The immense volatility and the sharp selloff is a major reversal for cryptocurrencies, which appeared to be gaining traction among major Wall Street banks and publicly traded companies.
The recent surge in the value of bitcoin can be attributed to major influencers such as Tesla CEO Elon Musk who up until now have espoused the virtues of cryptocurrencies only to recently change their opinions. Elon Musk has recently declared that the auto maker had suspended vehicle purchases using crypto currencies over environmental concerns.
The asset class continues to be highly volatile, with significant price movements resulting from a single tweet or government intervention on regulation and transparency. Bitcoin can be traded 24/7 leaving one investor to lament on his Twitter account that he can now lose money every day of the week!! BAM believes that cryptocurrencies are uninvestible at present, given their inherent volatility and sensitivity to influencers.