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The Crypto Crash
Bitcoin and Ethereum are now worth half of what they were at their all-time highs
Bitcoin’s price plummets due to ‘extreme market circumstances.’
Bitcoin (BTC) has dropped more than 10% this week, going below $25,000 for the first price since December 2020.
It is the latest in a string of price drops for the cryptocurrency, which has lost more than 60% of its value in the previous seven months.
The whole crypto market has also taken a significant hit, dropping more than $400 billion in the previous week to fall below $1 trillion.
Analysts estimate that the market drop coincided with a similar surrender of tech stocks recently, leading them to believe that the two are responding in unison to external market pressures.
“As inflation fears send stocks and crypto tumbling, the clearest signal yet that crypto-assets such as bitcoin and ether are moving in lockstep with equities has flashed.”
The market saw one of the worst weekends in its short existence, with significant currencies, Bitcoin and Ethereum, suffering the most.
As food and energy costs rise, many Bitcoin HODLers will be compelled to sell to make ends meet.
The necessity to sell Bitcoin to pay expenses will worsen as the recession deepens and many HODLers lose their jobs, particularly those working for soon-to-be insolvent blockchain startups.
Bitcoin, the world’s largest and most popular cryptocurrency, fell as much as 7% to USD 25,366, an 18-month low.
The global market capitalization dropped to USD 1.02 trillion from USD 1.10 trillion yesterday. On Sunday, the price of Bitcoin fell to roughly USD 27,000, its lowest level since late 2020, while Ethereum fell below USD 1,500 per ether.
Almost all cryptocurrencies, including Bitcoin, are currently worth half or less of their all-time highs.
According to experts, the crypto price drop indicates investors’ declining risk appetite.
