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Federal Reserve: Altcoins drags the price of Bitcoin Down

The Federal Reserve Bank of St. Louise has issued a article saying that bitcoin has two potential future. Grow indefinitely or disappear. They think the result will be in the middle.

Federal Reserve: a bullish case for bitcoins

The odds for bitcoins are released regularly, but the truth is that nobody knows why even the federal reserve can predict the future. Many industry leaders and investors are bullish when it comes to cryptocurrencies and bitcoins. Tim Draper predicts a price for bitcoins around $ 250,000 around the year 2022. Thomas Lee is a little more modest and stated that the fair future value would be around $ 150,000 per coin. However, he said that a fair value at this time is over $ 13,000 per currency. Sonny Singh revealed that the approval of a bitcoin ETF is determined by the value of the bitcoin. He said that an ETF could bring back the value of bitcoins back to $ 20,000.

The Federal Reserve of St. Louise has published an article that discusses the issue. It is not easy to evaluate cryptocurrencies and bitcoins, but they have tried. The bullish case is that Bitcoin will appreciate indefinitely due to its limited supply and ever-increasing demand.

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The authors, David Andolfatto and Andrew Spewak, conclude that one of the factors driving the price of Bitcoin is an ever-expanding supply of alternatives. Bitcoin is an inherently speculative and volatile asset. A fixed offering does not mean an ever-increasing value. The question determines the value, after all. According to Coinmarketcap.com, there are over 2,000 cryptocurrencies today. All other digital resources reduce the value of bitcoins.

Bitcoin is in fact the largest cryptocurrency and is, therefore, the ramp on the market for investors and the launch pad. However, cryptocurrencies like ethereum have taken market share since ethereum became the largest platform for initial coin offerings (ICOs). This, among other aspects, could have influenced the price of bitcoin and bring it to current levels.

Federal Reserve: a bearish case for bitcoins

The Federal Reserve also revealed a bearish scenario for bitcoins and said the following on assets:

"Consider now the bearish case for Bitcoin.This perspective is based on the fact that Bitcoin has no fundamental value and that sooner or later the market will recognize this fact.In our opinion, we can accept that Bitcoin trades above its fundamental value without claiming that its fundamental value is zero.Many securities trade above what might be considered their fundamental value.Orium, for example, trades above its value measured by its industrial applications. US dollar exceeds its fundamental value in respect of US tax obligations The reward that some people are willing to pay for gold and the US dollar reflects the value that these objects possess as a medium of exchange ".

The world of cryptocurrency remains in a phase of discovery and nobody knows the true value. Some believe that the bitcoin will be a deposit of value equal to the market capitalization of gold, which is currently $ 7 trillion. Others argue that this is a bubble and that the price would fall to zero. The Federal Reserve concluded that they believe the price will drop somewhere in the middle; "We think the future price path is more likely to remain limited between these two extremes." There's only one thing we know for sure, and that's what the weather will say. But one thing is certain, that blockchains and smart contracts are extensively tested around the world by many of the largest companies.

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Ledger Nano S - The secure hardware portfolio
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