California Companies Stop Using Bitcoin After Cryptocurrency Crash

Since early May, usage and investment in Bitcoin and other cryptocurrencies has plummeted around the world. The most popular, Bitcoin, fell from a high of a coin worth $67,582 in November 2021 to under $50,000 in December, to under $30,000 in April and, due to fears recession, higher gas prices, cryptocurrency shutdowns in Texas due to state mismanagement of energy, environmental concerns about the amount of energy needed for currencies and many other factors, Bitcoin is now worth well below $20,000, hitting a low of $19,425 on Tuesday.

In California, the fall in cryptocurrency was more acute as the state attracted many early investors, especially in the early 2010s when cryptocurrencies were in their infancy and were worth less than $1,000. dollars. Investments from Silicon Valley companies and investors played a major role in crypto’s first growth spike in 2017, with many of the first crypto companies also being established there in the early years.

“As crazy as the attitude of people shouting ‘This is the future’ or ‘This will make us all rich’ was in 2021, it was much more pronounced five years ago,” investment strategist Jerry explained on Tuesday. Dawson at the Globe. “And yes, companies in California had the first ICOs (Initial Con Offering, similar to the more traditional stock initial public offering), investors here put in money like crazy, and it really caught on from here.”

But as cryptocurrencies have begun to show more and more vulnerabilities in recent months, much of that buildup of optimism has quickly crumbled. In recent weeks, especially after hackers stole hundreds of millions of cryptocurrencies from Californians and California businesses, many Golden State residents have moved away from them. Many companies have even abandoned Bitcoin, Ethereum and other similar currencies as payment methods.

“I had to quit,” Los Angeles business owner Cesar Soto told The Globe. “I would make a trade one week, only for the value to drop the next when I traded it. What really upset me was that a few even told me after their purchase that they were throwing their Bitcoin this way at companies, like mine, who still accepted it. A lot of people had been sucked in by those Super Bowl commercials and needed a way to unload theirs. So a few weeks ago I just stopped taking it. I really had no choice. Many of us had to stop taking it.

“And we believed it. You know, there are problems with the banks, and I thought it was a better system. I was proven wrong.

California Cryptocurrency Concerns

California has taken many steps to be more crypto-friendly this year, with Governor Gavin Newsom signing an executive order for more crypto regulations and a bill allowing Bitcoin to be used to pay for government services. However, following the big drop in crypto stocks in May, not much has been done as lawmakers watch and see if they are stable. Many crypto exchange companies have also left California in recent years, largely due to a controversial business environment in California and the tech-friendliness of Austin and Miami. Although with rapidly falling currency prices, the pinch hasn’t hurt the state as much as the departure of other companies.

“I left San Francisco at the wrong time,” said Mils Bjornsen, a crypto investor who moved from San Francisco to Miami in 2020. put it all in Bitcoin. My losses were staggering. And now I wish I still had the house there because it would have been an amazing asset in case I couldn’t get out of this hole I’m in .

Nevertheless, many are hoping for a rebound.

“Cryptocurrencies cannot afford to lose ground now,” Dawson added. “The blockchain technology behind them is still groundbreaking and crypto needs to be there for proof of concept. This does not make this technology attractive.

“For California, I don’t know what to say to prevent everyone from opting out or choosing not to invest. People are returning to stocks and bonds, both of which are much safer and proven investments. Some people say that Bitcoin can go back up to $30,000 soon. Others are considering going to $10,000. Where it goes next will determine how many more people here pull out or if it scales up and proves itself. Who knows where it will go at this point.

Since Tuesday, investors around the world have been watching the daily changes in Bitcoin and other cryptocurrencies, hoping to see where it goes from its current price.

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