The price of bitcoin saw a massive plunge on Tuesday amidst a sell-off in the digital currencies market. Although the reason for undertaking this step was unclear, it may be linked to potential security concerns of the cryptocurrency after the U.S was successful in recovering the ransom given to the team that targeted the Colonial Pipeline.

The U.S police officials had confirmed the retrieval of $2.3 million in bitcoin paid to Darkside, the masterminds behind the devastating attack on the Colonial Pipeline. Documents obtained from the court proved that the investigation team was able to crack the password for one of the hacker’s bitcoin wallets.

More often than not, hackers ask for bitcoin as a form of ransom payment to decode data locked by the malware. Therein, the money was retrieved by a new task force in Washington, created by the government to counter the sudden increase in cyberattacks.

Bitcoin
Source: blog.ipleaders.in

Following this event, bitcoin fell below the $32,000 level on Tuesday morning. However, it soon recovered from the sudden fall and was seen trading at $32,854.99 in the evening. Several other coins have also seen a significant decline in their trading values.

The drastic fall in the value of bitcoin comes just two months after it reached its peak in April. The rise in bitcoin prices in the second half of April had made 2021 seem like the ideal year for digital currency, However, the recent plummet in prices has not only shook the entire market but also broken the trust of the investors.

Apart from the effects of seizing the Colonial Pipeline ransom, the cryptocurrency market is on the edge for a plethora of other reasons. Recent tweets by Tesla’s CEO Elon Musk have contributed significantly to the price cuts. From promoting the currency to using it as a means of payment in his own company, Musk was known to be a strong advocate of bitcoin.

However, it seems like his support for bitcoin was no less than a mere infatuation.  Just recently, his company has suddenly stopped accepting bitcoin as a method of payment, citing concerns over environmental degradation and thus, resulting in a major sell-off.

Additionally, Musk’s inconsistent attitude has been fueled by the Chinese authorities initiating a crackdown on crypto mining and trading. With all these factors in play, the price of bitcoin seems to be going down day by day. Investors are starting to lose confidence in the currency and the market seems to be shaken as a whole.