Technology

Bitcoin fails to recover from the “cryptocrisis”: this is how it is listed on May 12

(Illustration: Jovani Pérez)
(Illustration: Jovani Pérez)

The world of cryptocurrencies is facing one of its greatest crises and the greatest pressure is taking them bitcoin, the most popular digital currency of the momentwhich has seen its value plummet after this week posted its biggest loss in 11 months, which in turn keeps others like MOON of Terra.

Bitcoin, the first cryptocurrency launched on the market, was created by Satoshi Nakamoto (pseudonym) in 2008 after the financial crisis that affected the world; This digital currency promoted a libertarian ideal and sought to put traditional monetary and financial institutions in check.

Known in the world of markets under the acronym BTC, bitcoin uses cryptography to ensure that its management is decentralizedthat is, that it cannot be regulated by any banking institution or body, which in turn makes cryptocurrencies volatile.

It was on November 1, 2008 when Satoshi Nakamoto sent a message to the cryptography mailing list of the metzdowd.com website under the title Bitcoin P2P e-cash paper, where he referred to a new type of electronic money system. that it was not based on |a third-party relationship, but was direct.

It was not long until on January 3, 2009, bitcoin finally went live with a first batch of 50 coins called “the genesis block” which was mined by Satoshi Nakamoto himself. According to records, there are currently 19 million bitcoins in circulation, although the money supply continues to rise.

In 2013 this cryptocurrency, which was worth almost nothing in its beginnings, reached $1,000 and began to attract the attention of financial institutions. Months later, it faced its greatest crisis with the hacking of the MtGox platform directed by Mark Karpelès, where up to 80% of the units in circulation were exchanged, which caused its value to plummet.

In the last months of In 2017, a new rebound placed its value at 19.51 dollars. Today its price has exceeded $68,789.63, also influenced by comments from relevant figures such as Elon Musk, which has made it the most important cryptocurrency of these times.

Despite the progress and scope that Bitcoin and other large digital assets such as Ethereum have had, organizations such as the World Bank, the International Monetary Fund (IMF) and the Inter-American Development Bank (IDB) are still skeptical about the “ pros” of this type of cryptocurrency.

In contrast, there are others that have shown great interest in bitcoin, such as the case of the government of El Salvador, which on June 9, 2021 became the first country to adapt this cryptocurrency as legal currency, but not only that, but the president Nayib Bukele has also announced its intention to create the first BitcoinCity in Conchagua.

Similarly, Honduras Prospera, a Central American special autonomous zone launched in 2020 on the paradisiacal tourist island Roatán, has opted for the adoption of bitcoin as legal tender despite the fact that the banking authorities do not guarantee its operations. In Mexico and Portugal, there have also been political figures who have proposed the legalization of this digital currency.

While the debate heats up every day about the convenience or not of its implementation, bitcoin is trading this May 12 before noon at $28,474.92what it means a drop of -4.49% with respect to the last 24 hours and a recovery of 1.53% with reference to its value reached in the last hour.

On May 11, the cryptocurrency fell below $30,000 and hit its lowest in 11 months, however, to this day it has not been able to recover its value.

In terms of its market popularity, it has held the number one spot among cryptocurrencies. Bitcoin laid the groundwork for the rise of many of the existing altcoins on the market and marked a pivotal moment for digital payment solutions.

The keys of bitcoin.  (Illustration: Anayeli Tapia)
The keys of bitcoin. (Illustration: Anayeli Tapia)

A cryptocurrency is a digital medium of exchange that does not physically exist and that uses cryptographic encryption to ensure the integrity of its operations, while maintaining control over the creation of its new units.

Bitcoin was the first to hit the market and was later followed by others that have also had great relevance, such as Litecoin, Ethereum, Iota, Tether, Cash, Ripple, Decentraland and MOONeven some that emerged from memes like Dogecoin.

Cryptocurrencies have various factors that make them unique: not being regulated by any institution; not require intermediaries in transactions; and almost always use accounting blocks (blockchain) to prevent new cryptocurrencies from being created illegally or transactions already made from being modified.

However, by not having regulators such as a central bank or similar entities, they are accused of being unreliable, volatile, promoting fraud, not having a legal framework that supports their users (miners), allowing the operation of illegal activities, among others.

Although it could be a paradox, cryptocurrencies in turn guarantee security to their miners in terms of the network in which it is located (framework) and that it implies code management; Breaking this security is possible but difficult, because whoever tried it would have to have a computational power even higher than that of Google itself.

Juan Mayén, 28, CEO of Honduran firm TGU Consulting Group, poses for a photo showing how to use a cryptocurrency ATM, the first in the country that allows users to purchase Bitcoin and Ethereum using the local currency Lempira , in Tegucigalpa, Honduras.  August 27, 2021. REUTERS/Fredy Rodriguez
Juan Mayén, 28, CEO of Honduran firm TGU Consulting Group, poses for a photo showing how to use a cryptocurrency ATM, the first in the country that allows users to purchase Bitcoin and Ethereum using the local currency Lempira , in Tegucigalpa, Honduras. August 27, 2021. REUTERS/Fredy Rodriguez

To buy and exchange them you can through specialized portals. Its value varies in supply functionof the demand and the commitment of the users, so it can change faster than traditional money, but the more people are interested and want to buy a given currency, the greater its value.

However, whoever invests in this type of digital asset must be very clear that this form brings with it a high risk to the capital, since, just as there may be an increase, it may also have an unexpected collapse and end the savings of its users.

To store them, users must have a wallet digital or wallet, which is actually a software through which it is possible to save, send and make transactions of cryptocurrencies. In reality, this type of wallet only stores the keys that mark the ownership and right of a person over a certain cryptocurrency, so these codes are the ones that must actually be protected.

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