Bitcoin hit a few speed bumps this week, slowing down the momentum it gained after its positive reception by the Senate in mid-November.
China, the Bank of France, and Former Federal Reserve Board Chairman Alan Greenspan all warned about the risks and volatility inherent in the digital currency Thursday, sending its value plummeting.
Chinese authorities restricted Bitcoin transactions at Chinese banks, on the same day the Bank of France warned traders of the high-risk nature of the virtual money, reports the The Wall Street Journal. Officials cited concerns over fraud and financial stability.
“Even if Bitcoin does not today meet the conditions to become a credible means for investment that could therefore threaten financial stability, it represents a clear financial risk for those that hold it,” the Bank of France stated in a report.
Bitcoin’s value dropped 30 percent from a record high of $1,240 to $870.
Greenspan said the digital currency is not money, in an interview with Bloomberg Television.
“It’s a bubble,” Greenspan said. “It has to have intrinsic value. You have to really stretch your imagination to infer what the intrinsic value of Bitcoin is. I haven’t been able to do it. Maybe somebody else can.”
Bitcoin’s value reached a milestone last week when it hit a record high following following the two Senate hearing on the digital money, which said Bitcoin is a “legitimate financial instrument.”
A New York Times article Thursday said that Bitcoin is the equivalent of the “financial wild west,” without rules or regulation to prevent fraud and government activity. Although the virtual money is becoming more mainstream, it will likely be viewed as “suspicious” until it becomes more stable.
What We're Following See More »
"Christopher Steele, the former British intelligence officer who wrote the explosive dossier alleging ties between Donald Trump and Russia," says in a new book by The Guardian's Luke Harding that "Trump's land and hotel deals with Russians needed to be examined. ... Steele did not go into further detail, Harding said, but seemed to be referring to a 2008 home sale to the Russian oligarch Dmitry Rybolovlev. Richard Dearlove, who headed the UK foreign-intelligence unit MI6 between 1999 and 2004, said in April that Trump borrowed money from Russia for his business during the 2008 financial crisis."
"The British publicist who helped set up the fateful meeting between Donald Trump Jr. and a group of Russians at Trump Tower in June 2016 is ready to meet with Special Prosecutor Robert Mueller's office, according to several people familiar with the matter. Rob Goldstone has been living in Bangkok, Thailand, but has been communicating with Mueller's office through his lawyer, said a source close to Goldstone."
"Russian Ambassador Sergey Kislyak said on Wednesday that it would take him more than 20 minutes to name all of the Trump officials he's met with or spoken to on the phone. ... Kislyak made the remarks in a sprawling interview with Russia-1, a popular state-owned Russian television channel."