Bitcoin : The highs and lows in 2021 so far

Bitcoin, the world’s first and most popular cryptocurrency, has seen a meteoric rise in value over the last six months, despite regular warnings and reservations from experts, critics, and sceptics. Just last month, around the same time, the virtual currency reached an all-time high of nearly $65,000 (approximately Rs. 47.3 lakh), a massive increase of more than 450 percent in less than six months. Bitcoin prices have since plummeted, having lost more than half of their value since reaching an all-time high. Massive volatility has been a defining feature of cryptocurrency trading in 2021. And Bitcoin is no different. According to Coindesk, the price of one Bitcoin was $40,846 (approximately Rs. 29.7 lakh) on Friday at the time of writing. However, this was a significant improvement over Wednesday, when the cryptocurrency was trading near $30,000 per coin (roughly Rs. 21.8 lakh). The plunge to around $30,000 per unit was largely attributed to the Chinese government’s crackdown on digital currency trading in the country, which exacerbated a long-forecast sell-off. On May 13, Tesla CEO Elon Musk announced that the electric carmaker would no longer accept Bitcoin as a form of payment. Tesla invested $1.5 billion in Bitcoin earlier this year. Musk’s announcement, citing concerns about the “rapidly increasing use of fossil fuels for Bitcoin mining and transactions,” resulted in a 15% drop in Bitcoin’s value, with the cryptocurrency falling below $50,000 (roughly Rs. 36.5 lakh) before showing signs of recovery. However, Bitcoin is still a long way from reclaiming its all-time high of approximately $65,000. (roughly Rs. 47.3 lakh). Here’s a quick look at Bitcoin’s highs and lows in 2021: Bitcoin’s value was approximately $29,000 on December 31, 2020. (roughly Rs. 21.1 lakh). It surpassed the $40,000 mark in January (roughly Rs. 29.1 lakh). Tesla announced its $1.5 billion (approximately Rs. 10,900 crore) investment in Bitcoin on February 8, along with its intention to begin accepting the cryptocurrency as a form of payment. The announcement resulted in a significant increase in the price of Bitcoin. The cryptocurrency reached a monthly high of over $57,000 during the month (roughly Rs 41.5 lakh). Bitcoin’s steady rise continued in March, with the digital asset breaching the $60,000 mark (approximately Rs. 43.7 lakh) in the month’s middle. This rally extended well into April, which has been by far the best month for Bitcoin. Around mid-April, the cryptocurrency reached a record high of approximately $65,000. (roughly Rs. 47.3 lakh). From that point until approximately May 10, Bitcoin remained above the $58,000 mark (roughly Rs. 42.2 lakh). Musk’s May 13 announcement decrying Bitcoin’s “insane” energy consumption precipitated a precipitous drop in its price, which fell to around $49,000 (approximately Rs. 36.1 lakh) on May 14. While it was recovering, the Chinese government’s latest move dealt another massive blow to the currency, which fell to around $30,000 (approximately Rs 21.8 lakh) on May 19, almost to its December 31, 2020 value. Even though the currency has recovered in recent days, the currency’s price volatility has once again demonstrated what critics have repeatedly emphasised: vulnerability. Will another of Musk’s tweets or a global event serve as the catalyst for another Bitcoin ascension? Time will tell.