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Bitcoin Prices Fall Around Rs 4 Lakh In One Week. Why Are Prices Falling? Know Here
Bitcoin Price Fall: The tightening of interest rates by the Federal Reserve to control soaring inflation, has led to a sharp fall in the prices of Bitcoin.
New Delhi: Bitcoin prices have been on a downward trajectory for more than two weeks now. According to data available on investing.com, the price of Bitcoin, in INR, on December 23, 2021, was more than Rs 38 lakh. On January 7, 2022, the price of one Bitcoin was Rs 31.8 lakhs, 7 lakhs less than what it was barely 15 days ago. Interestingly, the price of the digital asset two months ago, on November 8, 2021, was almost Rs 50 lakhs. In the international markets too, the price of Bitcoin fell sharply and was currently at $42.8K.
— Bloomberg (@business) January 5, 2022
Why Are Bitcoin Prices Falling Sharply?
- Hawkish Stance By Federal Reserve
The USA has seen a sharp uptick in the inflation numbers in the past few weeks. The county recorded the highest inflation in the last 39 years, according to media reports. To stop the prices from soaring higher, the Federal Reserve has, recently, confirmed the plans to raise the interest rates.
The interest rates have largely been inversely proportional to the prices of Bitcoin, according to Business Insider. When the bond yields increase, people tend to pull their money out of these digital tokens and invest in government securities. Majorly, this has led to a sharp fall in the prices of Bitcoin in the recent past.
- Cryptocurrency Bill in India
The Government of India is on the verge of finalising a bill to either ban cryptocurrencies or to regulate the crypto market. The details have not been put in the public domain, but various media reports have said that the bill hinted towards either of the above two. This has led to a large number of people selling Bitcoin and other cryptocurrencies, leading to a sharp fall in prices.
The bill, ‘Cryptocurrency and Regulation of Official Digital Currency Bill 2021’ was to be introduced in the Winter Session of the Parliament in 2021. But it got delayed due to certain reasons. Just before the winter session started, on December 22, Bitcoin was trading at over Rs 38 lakhs. Since then, it has fallen to almost Rs 32 lakhs.