Bitcoin has taken a beating this week when bitcoin lending company Celsius halted withdrawals and transfers between accounts.
Bitcoin had lost more than 13% at one point on Saturday, reaching a low of $17,593.
Bitcoin has dropped more than 70% of its value from its all-time high. In 2021, Bitcoin achieved a high of more over $68,000.
Bitcoin fell below $20,000 for the first time since late 2020, indicating that the cryptocurrency bear market is deepening. The price of the most popular cryptocurrency, according to cryptocurrency news site CoinDesk, has plunged more than 13% to a low of $17,593 at one point on Saturday. Since December 2020, the most popular cryptocurrency has been in the most vulnerable position, until recovering to $18,556, still down 9.22%.
Bitcoin has dropped more than 70% of its value from its all-time high. In 2021, Bitcoin achieved a high of more over $68,000.
On Saturday, Ethereum, another famous cryptocurrency that has been on the slide in recent weeks, followed suit. Ether, a cryptocurrency backed by Ethereum, is down 74%. Ether plummeted below $1,000 for the first time, falling nearly 19% to $891, its lowest level since January 2021. Both crypto’s bellwethers have lost more than 70% of their value from their all-time highs in early November.
The whole market value of cryptocurrency assets has decreased from $3 trillion to less than $1 trillion, according to coinmarketcap.com, a website that tracks cryptocurrency values. As of Sunday morning, the global market value of cryptocurrencies was estimated to be approximately $840 billion, according to the company’s analysis.
Rasons for the bitcoin market’s decline
With the Terra blockchain’s demise last month, further signs of stress emerged, and they’ve grown this week as a result of crypto lender Celsius Network Ltd.’s recent move to halt withdrawals.
To add to the doom, crypto hedge fund Three Arrows Capital announced large losses and said it was considering asset sales or a bailout, while another lender, Babel Finance, followed Celsius’s route this week.
When cryptocurrency loan provider Celsius banned withdrawals and transfers between accounts, as well as crypto enterprises laying off personnel, bitcoin took a hit.
Coinbase announced the layoffs of roughly 18 percent of its workforce, with CEO and cofounder Brian Armstrong blaming some of the layoffs on an approaching “crypto winter.” Moreover, as investors flee risky assets, companies including Global Inc, Gemini, and BlockFi have indicated that hundreds of employees will be laid off. According to accounts, a bitcoin hedge firm was also in difficulty.
Concerns about rising interest rates and the possibility of a recession have coincided with a stock market sell-off, with US stocks plummeting by the most in two years.
Investors are selling riskier assets as central banks raise interest rates to combat growing inflation. Higher rates can help to reduce inflation, but they also increase the danger of a recession by increasing borrowing costs for consumers and businesses, as well as pushing down stock and other investment prices, such as bitcoin.
According to experts, what are the prospects of a crypto market crash?
According to Jeffrey Gundlach, CEO of DoubleLine Capital, Bitcoin might fall to $10,000.
According to David Gerard, a crypto critic and author of “Attack of the 50 Foot Blockchain,” the recent meltdowns show a failure on the part of authorities, who, he claims, should have put tighter regulation on the business years ago.
He went on to say, “There are actual human victims here who are everyday folks.” “Many budding investors, particularly young individuals, invested on the basis of a false hope sold to them.”
According to Alex Diaz, the administrator of a Facebook group for Bitcoin enthusiasts, the bitcoin dip is due to parallel developments in the cryptocurrency space, some of which are “just schemes or outright scams.”
“All it will take is some time to get back on track,” Diaz remarked.
