No slack in crypto slide, bitcoin at 18-month low

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Cryptocurrencies now symbolize a flight from speculative investing as monetary policy tightens around the world.

The freeze on withdrawals from major cryptocurrency lending firm Celsius Network dealt the latest blow to investors in the asset class, as bitcoin and ether plunged to fresh 18-month lows, with the cryptocurrency falling fresh on Tuesday.

Bitcoin fell 7.2 percent to $20,816, its lowest since December 2020, extending Monday’s 15 percent drop.

The world’s largest cryptocurrency is down more than 50 percent to date and 28 percent since Friday.

2 token Ether fell 10 percent to $1,075, its lowest since January 2021, and the smaller token suffered even more losses.

Singapore-based fund manager QCP Capital said in a note that the Federal Reserve is expected to hike rates sharply on Friday due to the suspension of withdrawals in Celsius and higher US inflation data.

“If Celsius goes bankrupt, the market is now afraid of the impact and the transition,” QCP said.

Celsius’ move on Monday sent cryptocurrencies down for the first time since January 2021, taking their value below $1 trillion, raising concerns the route could expand to other assets or affect other companies.

Corey Klipston, chief executive officer of bitcoin savings platform Swan Bitcoin, said, “Almost anything can be settled in crypto…”It’s all a house of cards.”

Citing extreme market conditions, Celsius said in a blog post published in Asia Hour on Monday that it had halted inter-account withdrawals and transfers “to stabilize liquidity and operations while we try to preserve and protect assets.” take steps for”.

New Jersey-based Celsius, which has assets of around $11.8 billion, offers interest-bearing products to customers who deposit cryptocurrencies on its platform. It then lends out cryptocurrencies to generate returns.

The cryptocurrency has become a symbol of the flight from speculative investing as monetary policy tightened around the world to combat price pressures and drain liquidity from global markets.

Overall asset classes have also been rocked by high inflation as investors have abandoned riskier assets.

The S&P index has been down for four days, with the benchmark now down more than 20 percent from its last record, high enough to confirm a bear market by the commonly used definition.

Cryptocurrency stocks have been hit particularly hard.

Shares in crypto bank Silvergate Capital closed down 16.7 percent on Monday, BTC buyer and business intelligence software provider MicroStrategy down 25.2 percent, and crypto exchange Coinbase Global down 11.4 percent.

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