Bitcoin fell through US$45,000 (HK$351,000) yesterday after financial veterans and experts expressed negative views on cryptocurrencies, saying they were too expensive and inefficient.
The digital asset touched a 24-hour low US$44,964.49, according to Coindesk. It fell 14.98 percent to US$46,506.12, compared to the previous 24 hours, as of 8pm. Ethereum was down 18.99 percent to US$1,460.81 in 24 hours, as of 8.04 pm.
The declines came after US treasury secretary Janet Yellen warned that bitcoin is an "extremely inefficient" way to conduct monetary transactions.
"I don't think that bitcoin is widely used as a transaction mechanism," she told CNBC's Andrew Ross Sorkin at a New York Times DealBook conference. "To the extent it is used I fear it's often for illicit finance," she said, adding that "the amount of energy that's consumed in processing those transactions is staggering."
Famed economist Nouriel Roubini meanwhile said bitcoin is a total speculative play on a bubble that is self-fulfilling. Roubini argued that retail investors with "fear of missing out" are going to get crushed by investing in bitcoin during its latest run higher.
"You have to ask yourself whether retail investors or institutional investors should be investing in something that is so risky and something that is not a currency and is not even an asset," Roubini added.
Tesla, which invested in bitcoin, fell 5.18 percent to US$677.49 in the pre-market trading. Tesla founder Elon Musk had earlier commented that bitcoin and ethereum now do seem high in Twitter.
And Microsoft co-founder Bill Gates said Musk has plenty of money to invest in bitcoin but general public who do not have much should be careful.
At a technical level, bitcoin is now overbought in a relative strength index, Matt Maley, chief market strategist at Miller Tabak said in a report.
In other news, China International Capital Corporation said cryptocurrencies would change the shape of the financial industry and after the launch of the central bank's digital currency, CICC believes that the form of financial services will change, and the digital capabilities of financial institutions may be an important factor in future market competition.
The digital asset fell nearly 15 percent.
REUTERS
