Bitcoin price has been falling for some time. The reason for this is the huge shock that has occurred in the cryptocurrency market.
Forbes noted that the current situation began in May related to the alarming consumer price index (CPI) report. This delivered another inflation shock to global markets.
The increased volatility has also led crypto lending company Celsius to halt customer withdrawals. This also raises concerns that contagion is sweeping the market, quoted on Monday (20/6/2022).
Whereas Celsius has quite a lot of customers up to 1.7 million. The company's advertisements are also quite promising, namely being able to earn an annual percentage yield of up to 18% by depositing crypto holdings on its platform.
Companies take crypto deposits and lend them to investors and other financial institutions. Users get a share of the income that Celsius generates from crypto borrowers.
But some time ago, Celsius announced it was stopping crypto withdrawals. The company reasoned that the decision was due to extreme market conditions.
"Due to extreme market conditions, we announced today that Celsius is stopping all withdrawals, swaps and transfers between accounts. We are taking this action to put Celsius in a better position to honor its withdrawal obligations," Celsius said.
Celsius is considered like a conventional bank account. Even using terms that look like accounts work similarly to bank accounts. But the company is careful enough to disclose operations not like that. "Your Celsius account is not a bank account, time deposit, savings, checking, or other type of asset account and should not be characterized as a banking product or service," Celsius said in its terms of use.
At the end of 2021, Bitcoin shot up almost 70%. This however represents something of a drop for Bitcoin after gaining more than 300% in lockdown-hit 2020.
In 2022, investors have a greater interest in value-based investments, says East Paces Group founder Alex Reffet.
"Collectively investors have shown greater interest in value-based investments and less in speculative stocks and alternative value-holding investments," he said.
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