Monday, June 27, 2022

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Bitcoin price crashes to lowest in months

Bitcoin prices have fallen to their lowest level in months following remarks from the US Federal Reserve.

The crypto-currency dropped in value from $47,000 earlier this week to less than $42,000 per digital coin.

It follows minutes from a meeting of the Federal Reserve, which suggested it may raise interest rates.

Furthermore, the political instability in Kazakhstan has also raised concerns about the network’s capacity, BBC writes.

The Fed’s released meting notes suggest that America’s central bank might raise interest rates sooner than some had anticipated, and sell off some of its assets.

That could have led to a knock-on effect of traditional investors who hold Bitcoin, as they pursue less risky assets instead.

At the same time, a huge amount of the world’s Bitcoin mining – the process by which transactions are verified and new “coins” made – takes place in Kazakhstan.

The massive Central Asian country has been hit with political unrest this week, as citizens took to the streets to protest against rising fuel prices.

Fatal violence followed as demonstrators – which the country’s leaders paint as “rioters” – seized buildings in the largest city, Almaty.

Kazakhstan is thought to process nearly a fifth of all Bitcoin “mining”, as the process is called, due to its usually cheap electricity. And an internet shut-down earlier this week appeared to hit the processing power of the entire Bitcoin network.

The dip means Bitcoin has hit its lowest price since September 2021, down from a November peak of more than $60,000.

Other crypto-currencies have also seen price falls. Ethereum saw its value drop from approximately $3,800 on Wednesday to under $3,200 on Friday.

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