(Bloomberg) – Bitcoin is a nursing loss after its worst weekly plunge in almost a year, and from one point of view its long-term outlook could be even worse due to environmental concerns and stricter regulations.
According to BTC Research Inc., the sheer amount of energy in the bitcoin mine and the possibility that the government will create more barriers to losing tokens for the most likely cryptocurrency points.
BTA Research Chief Global Strategist Peter Berezin wrote in a report released on Friday that the cost and sluggishness of bitcoin transactions make it “inappropriate as an exchange medium”. In addition, due to the large amount of energy released by miners on computer networks, environmental, social and governance-focused funds are likely to stay away from companies associated with Bitcoin.
Bitcoin is still more than five times higher in the past year, sparking a split rally of believers in a new asset class against nayayers who see a betting bubble. In recent significant developments Tesla Inc. Has bought $ 1.5 billion worth of tokens. At the same time, Bill Gates, co-founder of Micro .ft Corp., and Janet Yellen, Treasury Secretary, are among those taking precautions.
Governments will also create more obstacles because they could lose billions of dollars in revenue from seniority – the difference between the face value of money and the cost of its production, according to the BCA.
“Many companies have cooperated as far as Bitcoin to connect themselves with the technical mystery of digital currency,” added Berezin of BCA. “As ESG funds start to run away from Bitcoin, its price will start to spiral downwards. Stay away. “
Bitcoin, the largest cryptocurrency in London, rose 3% to 46 46,615 by 8:13 a.m. Monday. It broke a record high of 58,350 dollars a week ago.
Other critics are bullish on the outlook for digital currency. Despite the many risks, Bitcoin is at a tipping point and we are “at the beginning of a massive transformation of the mainstream of cryptocurrency,” Citigroup Inc. Wrote in a report.
The City team, including Kathleen Boyle, highlighted the increased attractiveness of tokens for institutional investors and the argument that they could help protect against the risk of inflation.
In the short term, investment flows in bitcoin funds may be at the key to price estimates. JPMorgan Chase & Co. strategists said the grayscale bitcoin trust has the largest trading volume – the crypto fund is the largest – and the cash coming into other bitcoin vehicles is “not strong enough to prevent the overall slowdown in the bitcoin fund.” Flow impulse. “
(Updates with comments from Citigroup from paragraph 8.)
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