The British market regulator warned that if consumers invest in crypto-asset products that promise high returns (such as Bitcoin), they should be prepared to “get nothing.”

On January 22, the price of Bitcoin continued to drop. According to Coindesk data, the price of Bitcoin once fell to 28,845 US dollars, down 17.83% from the highest price of 35,102 US dollars in 24 hours. As of 10:10 that day, the price of Bitcoin was about 29,918 dollars. Compared with the historical high of 42,000 US dollars in early January, the current Bitcoin value has fallen by more than 10,000 US dollars.

According to data from Bitcoin Homes, in the past 24 hours, the amount of liquidation on the entire network reached 8.424 billion yuan, and the number of liquidation was 1,45977. The largest single liquidation amount was US$6.5 million. As of press time, in the past one hour, the amount of liquidation on the entire network exceeded RMB 129 million. The reason for Bitcoin’s plunge is currently unclear, but investors believe that this may be a natural adjustment.

Michael Sonnesen, CEO of Grayscale Investments, the world’s largest crypto asset management company, said: “Revisions are a natural part of any market, especially in the Bitcoin ecosystem. From 2016 to 2017, we have experienced 6 times. About 30% or higher correction.”

As the second-largest cryptocurrency by market value, Ether also fell 10.47% during the same period. On January 19, local time, Ether also surged by more than 17% to an intraday high of $1,439, which is only one step away from the record of $1,448 set in 2018. Calculated by market value, Ethereum has quadrupled since its price high in 2018.

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Since the beginning of this year, the digital currency represented by Bitcoin has set new highs. Both institutional buyers and retail investors regard it as a safe-haven asset similar to gold. According to the Bank of America’s January survey of fund managers, Bitcoin has replaced “long technology companies” as the most crowded transaction, that is, the transaction with the most capital inflows. Even if it fell, it did not dampen the popularity of digital currencies.

However, as the price of cryptocurrencies continues to rise, warnings in the market have gradually increased.

The British market regulator warned that if consumers invest in crypto-asset products that promise high returns (such as Bitcoin), they should be prepared to “get nothing.”

According to a survey published by Deutsche Bank on January 19, Bitcoin and US technology stocks are regarded by investors as the biggest market bubble. Bitcoin is regarded as a more extreme situation. Half of the respondents rated Bitcoin as 10 points on a bubble level of 1-10.

Strategists at UBS Global Wealth Management warned that the value of cryptocurrencies may eventually become zero due to regulatory threats and central bank attacks.

Recently, European Central Bank President Lagarde stated that Bitcoin is a highly speculative asset that involves money laundering activities, and a global regulatory consensus on Bitcoin needs to be reached.

Former Federal Reserve Chairman Yellen also stated on January 19 local time that many cryptocurrencies are mainly used for illegal financing, at least in the transaction sense. She believes that the United States needs to study how to curb its use and ensure that anti-money laundering does not occur through these channels.

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