The price of bitcoin has spiralled downwards over the last 24 hours leaving some concerned over the performance of the digital currency.
It has fallen 10% to beneath the ‘psychological’ $7,000 level. At the time of writing, it was currently sitting at $6,816 (£5,292) which is a sharp decline from the $10,000 it hit earlier in the month.
Part of the reason for the fall is reported to be tough talk from the Chinese about cracking down on bitcoin.
‘Once [bitcoin or cryptocurrency trading] is discovered, it will be disposed of immediately, and it will be prevented from happening early,’ reads a recent statement from the People’s Bank of China, translated through Google.
Chinese President Xi Jinping said last month that the world’s second-biggest economy should accelerate the development of its own blockchain technology.
What is bitcoin and why is it used?
Bitcoin is a cryptocurrency that is used internationally and is stored completely online as a computer file.
It works without a central bank and is usually exchanged from person-to-person when it is sold or exchanged, without anyone working in-between to overlook the transaction.
Bitcoin was first released in 2009 and its value has fluctuated over the last ten years, reaching its peak in December 2017.
The cryptocurrency can be used to buy products and services, in in 2018 a company in Northern Ireland started to accept Bitcoin as a way of payment to buy a house.
People can track their ownership of Bitcoin by using a cryptocurrency wallet, which is a digital way to exchange payments.
It is easy to track Bitcoin as details are stored in a ledger called blockchain, which is publicly accessible and it includes all confirmed transactions.
The value of Bitcoin fluctuates all the time in a similar way to more conventional currencies.
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