The price of Bitcoin sharply dropped on Monday following U.S president Donald Trump’s sharp criticism of cryptocurrencies.
The American president, who is known for his controversial Twitter posts, posted his reservations towards crypto and the effect looked somewhat immediate. The world’s most valuable cryptocurrency dropped about 10% to $10,175 and then briefly dived below $10,000 to $9,872 according to CoinDesk data. The reason for the downward move is not clear, but many have linked it to Trump’s utterances that he was no fan of crypto.
President Trump pointed to crypto’s volatility as one of the key reasons why he was not behind it. The president said;
“I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity”
Facebook’s Libra which has been getting a lot of heat from crypto enthusiasts such as John McAfee, as well congress was not left out either. Trump’s thoughts on Libra, which will be pegged to a pool of government backed currencies and assets to maintain stability, was that Facebook should apply for a banking license if it seeks to become a bank.
As trump posted his remarks, swift responses came from those in the crypto industry. CEO of digital currency exchange platform Coinbase, Brian Armstrong reacted quickly; stating that Trump’s criticism was an achievement since it was going to put crypto under a brighter spotlight. Tom Lee of the Fundstrat global advisers also saw criticism from a sitting American president as positive, since it meant that cryptos were finally on the main stage now.
Achievement unlocked! I dreamt about a sitting U.S. president needing to respond to growing cryptocurrency usage years ago. “First they ignore you, then they laugh at you, then they fight you, then you win”. We just made it to step 3 y’all. https://t.co/N3tzUKELaK— Brian Armstrong (@brian_armstrong) July 12, 2019
Despite Trump’s criticism and the pullback that followed, BTC is still 160% up compared to its value at the beginning of the year. Analysts have attributed this meteoric rise to big companies such as Facebook getting involved in the space. BTC did not plunge alone, Altcoins like Ether saw a 17% drop to around $221, while XRP fell by 5% to around 31 cents.
President Donald Trump’s criticism of crypto is not unique. The arguments he made against crypto have all been heard before from popular crypto cynics such as Nouriel Roubini. The same old arguments that crypto is not money, highly volatile, and not based on anything have been discussed, with many analysts in the space giving adequate and sensible responses as was seen when Bitmex CEO Arthur Hayes debated Roubini in Taipei earlier this month.
Image Courtesy of slate.com
