Bitcoin drops further below key $50,000 level after Yellen calls it ‘extremely inefficient’
Bitcoin and other cryptocurrency prices tumbled on Tuesday, after a sharp warning from Treasury Secretary Janet Yellen.
“It’s an extremely inefficient way of conducting transactions, and the amount of energy that’s consumed in processing those transactions is staggering,” Yellen said in an interview with the New York Times’ Dealbook late on Monday. It isn’t the first time she has criticized the cryptocurrency, which she said is often used for illegal transactions.
However, Yellen, also said digital currencies were likely here to stay and that a “digital dollar” could serve as an easier payment system for many Americans who don’t have that access.
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The former Federal Reserve chair has made clear since taking over the Treasury that her department will take a close look at bitcoin, with possible regulation to come.
She’s only a “temporary game-stopper,” said Stephen Innes, chief global markets strategist at Axi, in a note to clients. “Besides the enormous Middle East consortium interest in the bitcoin ETF trading on the Toronto exchange that needs to hedge physical, but if corporates start to add physical coins to the balance sheet this year, that is the game-changing panacea,” he said.
Bitcoin recently topped a $1 trillion in market value for the first time, and big moves seen this year have drawn in more investors and interest from companies such as electric-car maker Tesla TSLA,
But bitcoin had volatile start to the week, dropping on Monday in a move that some blamed on Tesla TSLA,
That back-and-forth between Musk and Schiff continued on Tuesday, with the latter criticizing the electric-car CEO’s bitcoin approach. Musk responded with an eggplant emoji, which some inferred was his way of dismissing the comment. That emoji was banned by social media group Facebook on its Instagram unit over phallic symbolism and foods.
