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The value of bitcoin is falling to $ 20,000 as the cryptocurrency deepens

Bitcoin prevented a fall below $ 20,000, backed by a market rally after the Federal Reserve approved the biggest interest rate hike since 1994.

According to Dow Jones Market Data, on Wednesday bitcoin was set at $ 21,685.02, which is 1.4% lower than the price at 17 o’clock on Tuesday. In the morning, it traded at $ 20,111, threatening to fall below $ 20,000 for the first time since December 2020.

However, it remains lower by about 68% from the high of $ 67,802.30 reached in November 2021.

The defeat of cryptocurrency destroyed bitcoin profits in a year and a half, which began to grow in late 2020, when speculative passion swept the financial markets.

Since late last year, air has been leaking out of cryptocurrencies, and investors are abandoning riskier assets in anticipation of the end of easy money market conditions.

Two high-profile incidents in recent weeks have accelerated the decline of cryptocurrencies. In May, the collapse of the TerraUSD stablecoin and its cognate token Luna sparked a cryptocurrency sell-off. Then, on Sunday, Celsius Network, one of the largest cryptocurrencies, said it was stopping all withdrawals, swaps and transfers, causing further panic.

The value of the broadcast, Ethereum network’s own currency, fell 0.8% to $ 1,177.44 from a 17:00 ET on Tuesday after trading at $ 1,013 on Wednesday. However, most other cryptographies have grown. Of the top 30 tracked by CoinDesk, 26 rose late Wednesday afternoon.

The pain in cryptocurrency markets was widespread. The value of the broadcast, Ethereum’s own currency, fell to $ 1,013 on Wednesday and was recently at $ 1,080, up 9% from 5pm on Tuesday. Cardano’s token token and even the joking cryptocurrency dogecoin have slipped. Of the top 30 tracked by CoinDesk, 29 fell on Wednesday afternoon.

The latest sign of stress and confusion came from a vague tweet from the co-founder of Three Arrows Capital, a hedge fund that has invested heavily in cryptocurrencies. “We are in the process of communicating with the relevant parties and are fully committed to this development.” tweet said. No further details were provided. Three Shots did not respond to a request for comment.

Sales continued to beat major U.S. stock indexes, and the S&P 500 entered the bear market on Friday for the first time in more than two years. Caitlin McCabe of the WSJ examines some of the key causes of market volatility. Photo: John Minchilla / Associated Press

The fall of cryptocurrencies coincides with a sell-off in the stock market. Earlier this week, the S&P 500 entered a bearish market, defined as a drop of 20% or more from a recent high.

Losses have accelerated in recent days after higher-than-expected inflation data for May raised concerns that the Federal Reserve may need to raise interest rates more aggressively. On Wednesday, the Fed approved an increase in interest rates by 0.75 percentage points and said it would continue to raise rates this year at a rapid pace.

Write Caitlin McCabe at caitlin.mccabe@wsj.com

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The value of bitcoin is falling to $ 20,000 as the cryptocurrency deepens

Source link The value of bitcoin is falling to $ 20,000 as the cryptocurrency deepens

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