It’s a cold wind blowing in the realm of encryption and especially the king of digital currencies, bitcoin.
Bitcoin prices are at their lowest level since 2020. They have fallen more than 12% in the last 24 hours and finally the control was around $ 23,952.
Some observers say the fall has not taken place. Economist Adam Schiff, one of the biggest critics of bitcoin and cryptocurrencies, predicts that the most popular digital currency will fall by at least $ 20,000.
In general, the encryption market has lost more than $ 2 trillion since November, with a current valuation of about $ 1.02 trillion.
Bitcoin alone accounts for just over 45% of the encryption market, according to data company CoinGecko.
Bitcoin has lost more than 65% of its value from its all-time high on November 10, at $ 69,044.77.
Companies like software provider Microstrategy (MSTR) – Get the MicroStrategy Incorporated reportTesla electric vehicle manufacturer (TSLA) – Get the Tesla Inc report and fintech Block (SQ) – Download Block Inc. Report Category A, formerly Square, keep bitcoin on their balance sheet. The impact of bitcoin falling on these ranges is sharp.
Microstrategy has lost more than $ 910 million
MicroStrategy, the company of billionaire Michael Saylor, owns 129,218 bitcoins, 4,827 of which were bought in the first quarter at an average price of $ 44,645.
In total, the company has spent about $ 3.97 billion on its bitcoins. After the company’s bitcoin stocks soared during the meteoric rise of cryptocurrencies last November, they are now valued at $ 3.05 billion, according to Bitcoin Treasuries.
In other words, Saylor’s bet on bitcoin is now losing at least $ 910 million.
It is no surprise, then, that Microstrategy shares fell on June 13. Finally, the stock was a 24% discount from Friday at $ 153. This is a 72% discount from the beginning of the year.
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But the fall does not deter Saylor, a bitcoin evangelist.
“In #Bitcoin We Trust,” the billionaire wrote on Twitter on June 13.
MicroStrategy implemented its bitcoin strategy in the third quarter of 2020, becoming the first established company to add digital currency to its balance sheet. One of the consequences of this decision is that the performance of the group’s shares essentially reflects the direction of the bitcoin price, upwards or downwards.
The company’s first quarter results reflected a $ 170.1 million impairment charge due to bitcoin. MicroStrategy had to reduce the value of bitcoin cash to better reflect changing prices. In total, the company has recorded a total impairment charge of $ 1.1 billion associated with its bitcoin holdings.
The bitcoin disaster is also affecting Tesla and Block, which have invested in cryptocurrency. Tesla owns 43,200 bitcoin and Block has 8,027.
Tesla and Block are also in the red on Bitcoin
On February 8, 2021, Tesla invested $ 1.5 billion in virtual currency and said it had begun accepting it as payment for the purchase of Tesla cars. The value of this investment has been reduced by almost $ 500 million.
As for Block, which is run by CEO Jack Dorsey, who is also a bitcoin evangelist, the value of his investment is reduced by about $ 33 million.
The fall in the price of bitcoin may well affect the shares of both companies to one degree or another. In the last audit, Tesla shares fell 4.6%, while Block shares fell more than 10%.
Also strongly influenced by the fall of bitcoin and cryptocurrencies is the cryptocurrency exchange platform Coinbase, (COIN) – Get the Coinbase Global Inc report the most popular exchange in the USA
The company’s share in the last audit also fell more than 10%. Coinbase shares have lost 79% of their value this year.
The company recently said that the prolonged period of falling cryptocurrency prices, known in the industry as Crypto Winter, had a major impact on its growth. Coinbase implemented cost-saving measures, including the indefinite suspension of recruitment, and withdrew some of the job offers it had made to candidates.
“In response to current market conditions and ongoing business hierarchies, we will extend our recruitment for both new and complementary roles for the foreseeable future and cancel a number of acceptable offers,” said LJ Brock, Chief People Officer, on a blog. Position.