Reasons for depreciation of digital currencies After more than a decade since 2009, these currencies have flourished during the Corona virus crisis and beyond, until...
The reason for the diffusing is 88% more than a decade ago.
- Russian-Ukraine conflict has destabilized the global financing system.
The global economic system has hardly recovered from the adverse effects of the Corona virus crisis, which has affected global supply chains and caused inflation, until the Russian-Ukraine war began, which directly affected one of the pillars of the global financial system, namely, the trade of energy sources and global agricultural crops, which has caused price escalation and the disruption of their supply system as a result of sanctions and has led to global inflation and inflation, in turn, has led to a steady increase in the value of profits.
- Disposal by investors of hazardous assets
This is in response to persistent inflation, global decline in liquidity and high interest rates, which prompted investors to replace dangerous and speculative assets, most notably those encrypted with more secure assets, such as the use of liquidity by investors in the form of deposits by banks to benefit from higher interest rates. The decision to raise interest rates is followed by central banks such as the United States federal, the England Bank, and almost the European Bank ' s central bank ' s liquidity depreciation portfolio, with the aim of interest.
Celsius has declared its decision to suspend withdrawals and all transfers, trades or temporary encrypted currency lending
This step has played a role in double-discretioned currency depreciation as the largest credit company for encrypted currencies, where Celsius and similar companies are doing work similar to the basic notion of traditional banks but in digital currency, i.e. lending encrypted currencies for interest, receiving deposits for encrypted currency deposits, far from any government supervision or a centralized currency bank, which may be dealt with over traditional currency exchange rates.
- Digital currencies are fragile and unproductive
Digital currencies are not linked to physical assets or intellectual property, which do not generate cash flows and produce profits, and their price is related only to supply and demand, which is severely affected by the upward or downward state of liquidity of investors, which makes it difficult to assess their basic value, as Dr. Vadi Amorush pointed out, where he wrote about the American businessman Warren Buffet ' s statement on Pitcoin:
It is not possible to understand the meaning of any statement or opinion without understanding the general context of it and a strategy that, for example, Warren Buffet ' s refusal to invest in Pitcairn has been deliberated, or even wonderfully, in order to understand this statement, you will have to know Warren Buffett ' s original investment, which, for example, does not invest in a lost asset and raises his market value. Within this context and vision, his statement is understandable and correct. There is no reason why Betcoin is an investment. Investment means selling, buying and winning sales. Tesla doesn't even consider her possession of Bitcoin for more than $1.5 billion that it is an investment, but it is a form of distribution of cash in different forms of value preservation. In this context, we understand how Warren Buffet, of course, does not buy Bitcoin because of his belief that it is a form of investment and rightly, but invested in the Brazilian Bank of Nonbank over $1.25 billion, one of Brazil ' s biggest financial technology banks focused on encrypted currencies and Bitcoin.
Is it an opportunity to have digital currency at a low price? In addition, experts in encrypted currencies are advised to spend their investment with extreme caution in the light of the expectations that currency prices will continue to deteriorate at least in the short term. Finally, the area of investment in controversial digital currencies will certainly be new in order to preserve the vast and fast-track profit situation, which attracts much investment, or the rapid deterioration of the gold market, which will cause losses at least senior partners