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Cryptocurrencies Tumble as Trump Says Bitcoin is a “Scam”

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Bitcoin and its digital “cash wallets”. Credit: Wikimedia Commons/ CC0

Former US President Donald Trump said bitcoin was a “scam”, leading to a cryptocurrency sell-off on Tuesday.

“Bitcoin, it just seems like a scam,” he told Fox Business. “I don’t like it because it’s another currency competing against the dollar… I want the dollar to be the currency of the world. That’s what I’ve always said.”

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Bitcoin was down 8.5 percent on Tuesday morning, to trade at $32,871, Ethereum (ETH-USD) — the world’s second largest crypto by market cap — fell about 9 percent and was trading at $2,498. Meme-inspired dogecoin plunged 12.6 percent to trade at $0.324.

Trump not a fan of bitcoin

Back in 2019 when Trump was president, he had said he was “not a fan” of cryptocurrencies.

In a tweet, he had said at the time cryptos “facilitate unlawful behavior, including drug trade and other illegal activity”.

The price of Bitcoin has been falling steadily since early May and so far has not recovered.

The falls were widely attributed to China banning banned banks and payment firms from providing services related to crypto-currency transactions, as well as electric car maker Tesla announcing it would no longer accept the currency a week before that.

The internet vigilante group Anonymous warned Elon Musk about his Bitcoin comments on Saturday after the CEO of Tesla posted a tweet that sent the value of the cryptocurrency falling.

Musk, once a vocal advocate for the use of Bitcoin and other cryptocurrencies, sent out a tweet on Friday that caused the price of the world’s largest cryptocurrency to fall drastically.

Bitcoin volatility nothing new

Speaking recently to Greek Reporter, Lexy Prodromos, Executive Director at the Chicago Blockchain Center, a non-profit public/private initiative dedicated to blockchain advocacy, education and community innovation, said that bitcoin volatility is nothing new.

“It’s completely market determined. It’s a global network that’s not owned or operated by a single company or country or government. So price volatility is definitely a part of owning Bitcoin,” Prodromos told Greek Reporter.

“I think people are recognizing Bitcoin’s value and that it is a scarce digital asset, that will gain in value over the long run,” Prodromos said.

In fact, there are only 21 million bitcoins that can be mined in total, with the final coins being minted in around 2140. Once the circulating supply reaches its maximum, Bitcoin miners will no longer receive block rewards — since there’s only ever going to be 21 million of them.

The limited supply of Bitcoins is one of the reasons, proponents believe, that its value will keep on rising despite occasional hiccups.

“I’ve been around in the space for the last five or six years or so. And even in that time we’ve had price dips like this before, we’ve had several magazine articles over the years declare that Bitcoin and cryptocurrency is dead,” the Greek-American exec notes.

The cryptocurrency community is growing “despite lots of lots of misinformation and somewhat bad press over the years. It’s just really continued. And I think the resiliency of the Bitcoin community kind of speaks to that.”

Prodromos says that the problems facing Bitcoin and other cryptocurrencies are the same kind of problems faced with any emerging technology — “there’s always going to be this kind of push and pull between government, entrepreneurs and innovators.”

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