Bitcoin has defied predictions and gained almost 170% in value since the European Central Bank (ECB) sounded the alarm about its impending “irrelevance.”
On November 30, 2022, when the ECB published a blog post declaring Bitcoin’s demise, the cryptocurrency was trading at just $16,400.
The post argued that even these levels were just a pitstop on the way to further price declines.
According to the ECB’s post, Bitcoin’s value had peaked at $69,000 in November 2021 before plummeting to $17,000 by mid-June 2022.
The post suggested that Bitcoin’s apparent stabilization was merely an artificially induced last gasp before its inevitable descent into irrelevance.
Contrary to the ECB’s predictions, Bitcoin continued to thrive. After briefly revisiting the $16,400 mark in mid-December, it made a swift comeback, surging by 70% in the first quarter of 2023 alone.
A year after the ECB’s premature obituary, Bitcoin was trading at its highest since April 2022, reaching $43,800, marking a 166% increase from the time the ECB issued its warning.
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Crypto enthusiasts and experts expressed amusement at the ECB’s erroneous assessment.
Philip Swift, creator of the statistics platform Look Into Bitcoin, found satisfaction in the situation.
Alex Thorn, head of firmwide research at crypto education resource Galaxy, questioned the ECB’s credibility and wondered about other areas where the bank might be wrong.
The ECB has a reputation as a Bitcoin skeptic, with its views on the cryptocurrency market often causing embarrassment. ECB Chief Christine Lagarde, in a recent statement, revealed her low opinion of cryptocurrencies and noted that her own son had disregarded her advice on crypto investments and suffered losses as a result.
Despite its skepticism toward Bitcoin, the ECB is actively exploring the possibility of launching a central bank digital currency (CBDC).
However, this initiative has faced scrutiny, especially after Lagarde admitted that a CBDC could offer enhanced transaction control, sparking concerns about privacy and surveillance within the financial system.
Bitcoin’s remarkable resilience serves as a reminder of the unpredictable nature of the cryptocurrency market and the challenges faced by traditional financial institutions in understanding and adapting to it.
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