It looks like the BTCs roller-coaster will not end soon. The prominent cryptocurrency ended the first half of 2021 with wild volatility. Keep in mind that the asset hit a high of around $65K in April. However, as the first half of the year ends, the leading coin trade at a 47% dip from its record highs. With that, here are the risks that threaten the BTC space.
Crypto regulation is the only thing that has been, and it will be a hurdle that Bitcoin has to deal with for a friendly market atmosphere. Although financial experts like StormX’s Simon Yu remain pessimistic about the crypto crackdown by China, overregulation from regions such as the US will be an obstacle in Bitcoin upswings.
Volatility has always been a concern in Bitcoin’s market. Also, most investors are skeptical about Bitcoin investments due to the wild price movements that coin sees from time to time. As much as enthusiasts refer to it as a “digital coin,” volatility tends to destroy the whole fun. For instance, no one can tell where the coin heads next after losing nearly half its value since its highest prices.
- The Environment
Environmental concerns account for the current turmoil in the Bitcoin market. The asset started witnessing drastic falls after Elon Musk declared that Tesla would no longer accept crypto payments due to the high power the mining need and the impacts on the environment. As much as the mining council promises satisfying results, it is without a doubt that environmental effects will hinder the coin’s chances to register high prices.
- The Scrutiny
Bitcoin and other digital coins continue to suffer from stablecoin’s presence in the market. Remember, stablecoins will have their prices linked to real-world instruments like the Dollar, which intensifies scrutiny in the entire crypto world.
- Meme Coins
As Dogecoin leads the pack, meme coins have proved to be a threat in the crypto market. That is because these assets tend to be highly susceptible to crypto activities. Also, some interested investors tend to avoid the market due to the ‘joke’ assets.
However, regardless of the threats, Bitcoin remains the leading asset as far as market capitalization is concerned.
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