After hitting a ceiling at $2.5 trillion last month and subsequently losing a trillion dollars in value, the cryptocurrency market has been attempting a mild recovery. Now back up to a conservative $1.7 trillion, crypto fans are hoping the month-long bearish trend is making a reversal.
Statistics from the United Kingdom show a significant increase of crypto investors in the country, with approximately 2.3 million citizens now getting involved. This indicates a growth of around 20% from only 1.9 million last year. Surveys also show that more adults have heard of cryptocurrencies, up to 78 percent from 73 percent last year.
The growing number of investors can be attributed to the incredible gains that the crypto market has made this year, compounded by popular tech giants like Tesla and Square announcing investments into Bitcoin. However, the UK’s Bank of England Governor Andrew Bailey doesn’t share the same sentiment. Last month, he criticized the cryptocurrency market, stating that assets like Bitcoin and Ethereum lack intrinsic value.
“Now that doesn’t mean to say that people don’t put a value on them because they can have extrinsic value. But they have no intrinsic value,” he said.
The UK Financial Conduct Authority (FCA) executive director Sheldon Mills shares Bailey’s skepticism, noting that cryptocurrencies put investors at risk due to their unregulated nature.
“If something goes wrong they are unlikely to have access to the FSCS or the Financial Ombudsman Service,” he said.
While he’s not wrong, it would somewhat defeat the purpose of a decentralized, peer-to-peer economy if it was regulated by a centralized financial institution.
Fortunately, the criticism doesn’t appear to have deterred investors, with Bitcoin enjoying 4.6 percent growth over the past week. The leading cryptocurrency has faced strong resistance at $40,000, having twice failed to break the level earlier this week. Now, traders will be keeping a close eye on Bitcoin’s relative strength index (RSI) as it continues to climb from a low of 20 back towards the key bullish level above 70.
