Bitcoin and cryptocurrency prices have skyrocketed in the last year, fueling a surge of interest in the digital asset space as traders and investors pile up.
The price of bitcoin is now trading at just under $ 60,000 compared to under $ 20,000 this time last year, with bullish investors predicting the price of bitcoin. as well as the price of some smaller cryptocurrencies, will keep going up.
Ahead of the latest price spike, which pushed the bitcoin and cryptocurrency market to around $ 3 trillion from lows of $ 150 billion in 2020, Germany's new Chancellor Olaf Scholz warned a "tulip" style bubble that is developing in the cryptocurrency marketโAdding "the monopoly of the currency" must remain in the "hands of the states."
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Olaf Scholz, who has served as Germany's finance minister since March 2018 when he warned about ... [+]
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"I would doubt if [bitcoin and cryptocurrencies have] any perspective as a currency model, "Scholz said in 2018, as reported Reuters and translated into English by Google. "The danger is high that it will turn into tulip inflation," added Scholz, referring to the famous speculative tulip bubble that began in 17th century Amsterdam.
Scholz, who is expected to lead efforts for Germany's transition to a green economy, also warned about the way the energy-consuming decentralized bitcoin network is being maintained.
The bitcoin network is believed to consume nearly 200 terawatt-hours of electricity a year, according to the University of Cambridge. Bitcoin Electricity Consumption Index, comparable to the energy consumption of Thailand. Earlier this month, Swedish authorities called on the European Union to ban the creation of energy-intensive bitcoins and cryptocurrencies and network maintenance, a process known as mining.
More recently, Scholz criticized Facebook's plans to launch a bitcoin-inspired cryptocurrency, calling changes made by the social network to address regulators' concerns "cosmetic."
"I don't support private sector digital currencies," he said. said in November of last year, going to tell: "We must do everything possible to ensure that the monopoly of the currency remains in the hands of the states."
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The price of bitcoin has skyrocketed following Olaf Scholz's warning that the market for bitcoins and cryptocurrencies ... [+]
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Other world leaders have also warned of the growing use of bitcoins and cryptocurrencies.
Last week, Hillary Clinton, a former US presidential hopeful and secretary of state during Barack Obama's presidency, said the rise of bitcoins and cryptocurrencies could undermine the status of the reserve currency of the US dollar.
"What seems like a very interesting and somewhat exotic endeavor to literally mine new currencies to trade has the potential to undermine currencies, to undermine the role of the dollar as a reserve currency, to destabilize nations, perhaps starting with the small ones. . but going much further, "Clinton said, speaking during a panel discussion at the Bloomberg New Economy Forum in Singapore, adding that he expects "nation-states to start paying more attention to the cryptocurrency boom."
