[Bitcoin Now] Drops to 37 Million KRW Range... Powell Says "Bitcoin Will Become Unnecessary"

Tyler Winklevoss, Gemini CEO, "Fed's Quantitative Easing Policy Will Boost Bitcoin Value"
Kazakhstan Emerges as a Bitcoin Mining Country

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Gong Byung-sun] The leading cryptocurrency Bitcoin has fallen to the 37 million KRW range. This is interpreted as being adversely affected by Federal Reserve Chairman Jerome Powell's remarks predicting Bitcoin's downfall.

According to the domestic cryptocurrency exchange Upbit, as of 12:56 PM on the 16th, Bitcoin recorded 37.56 million KRW, down 0.10% from the previous day. After rising to 40.57 million KRW on the 12th, it has been declining for five consecutive days.

Chairman Powell's comments on the introduction of a digital dollar acted as a negative factor. On the 14th (local time), during a House Financial Services Committee hearing, he said, "If the United States introduces a digital currency, cryptocurrencies and stablecoins will become unnecessary," adding, "This is why I support the digital dollar." Stablecoins refer to cryptocurrencies designed to be linked to fiat currencies to minimize price volatility. Furthermore, he explained that after a Federal Reserve meeting in early September, a report related to digital currency would be published.

The cryptocurrency industry reacted against Chairman Powell's remarks. On the same day, Tyler Winklevoss, CEO of the overseas cryptocurrency exchange Gemini, tweeted, "Just as the dollar did not make gold useless, the digital dollar will not make Bitcoin useless," adding, "Rather, the Fed's quantitative easing policy will raise Bitcoin's value." This implies that even if a digital dollar is introduced, Bitcoin will be used as a hedge against inflation losses.

Meanwhile, research has emerged showing that Kazakhstan, a Central Asian country, has risen as a Bitcoin mining country to replace China. Citing research from the Alternative Finance Centre at the University of Cambridge, the U.S. economic media CNBC reported on the 15th that Kazakhstan's share of total Bitcoin mining electricity consumption increased from 1.4% in September 2019 to 8.2% in April this year. During the same period, China's share decreased from 75.5% to 46%. CNBC analyzed that mining companies moved to nearby countries before the Chinese government cracked down on Bitcoin mining. Previously, since last month, the Chinese government has been imposing strong regulations on cryptocurrency mining companies, mainly in Inner Mongolia and Sichuan Province.