1 month ago- News -
High Volatility Is the Main Risk With Cryptocurrencies
As we already know, the crypto market has been quite volatile for the past week, it has seen dramatic downfalls and attempts to crawl back up. As BNG reported yesterday, Bitcoin went down 10% and due to Ethereum’s high volatility its no longer second largest cryptocurrency on the market. Peru’s central bank stated on the events, that the greatest risk regarding cryptocurrencies is the volatility.
The statement that followed the recent breakdown of the cryptocurrency market looks like this:
“Cryptocurrencies are not supported by central banks and pose risks due to the high volatility in their price, fraud cases and their possible use in illicit activities. Bitcoin’s price fell 56% as of October 2018, and has lost an additional 13% percent in November.”
However, according to the data that crypto statistics website Coin Dance from LocalBitcoin provided, the number of cryptocurrency traders in Peru is increasing, meaning that although the market is experiencing a dramatic breakdown, Peruvian traders are still very interested in it.
At the moment, Peru is not creating any kind of regulation for cryptocurrencies, but one year ago, in September, Peru’s Superintendency of Banking and Insurance (SBS) joined blockchain related company R3, which is an enterprise software firm that focuses on distributed database technology for research in order to study the new technology of blockchain and find out how can it be implemented in the country.
As we already know, the dramatic downfall of the cryptocurrency market is not the final destination, there are a lot of predictions, stating that the situation with cryptocurrencies will get better in Q2 2019.