Bitcoin plummeted below $ 18,000 for the first time since December 2020, after cryptocurrency companies began firing employees and investors shunned risky assets as interest rates rose.
According to data from analyst firm Coinmarketcap, the value of the global cryptocurrency market, including Bitcoin, fell by about 0.17% in just 24 hours, dropping below $ 836 billion.
The price of the largest cryptocurrency Bitcoin, albeit temporarily, fell below $ 18,000 for the first time since December 2020, and then recovered slightly and rose above $ 19,000.
Bitcoin’s depreciation over the past seven days has approached 31%. On May 21, Bitcoin’s market capitalization was $ 558.6 billion, while on June 19 it was below $ 400 billion.
The continuation of the downward trend in the price of Bitcoin causes heavy losses in other cryptocurrencies as well.
Ethereum, which ranks second in terms of market value, also lost more than 32% in the past week, dropping below $ 1000.
It was interesting to note that the latest crypto money market decline came after the week of the highest percentage drop in the past two years, due to rising interest rates in the US stock market and the growing risk of recession in the economy. .
In mid-May, the cryptocurrency TerraUSD in value ‘to collapse’ Celsius Network, one of the largest cryptocurrency lenders, on June 13, after rocking the cryptocurrency market ‘extraordinary market conditions’ announced that it has suspended all operations due to This has led to greater uncertainty in the market.
Despite the turmoil surrounding the Celsius Network and the views of central banks, notably the US Federal Reserve (Fed), that they will continue the tightening process more aggressively after the Fed hiked 75 basis points last week As investors shy away from risky assets, in parallel with this, growing uncertainties in the cryptocurrency industry continue to keep the cryptocurrency market under pressure.
Cryptocurrency exchange Coinbase announced on June 14 that it will cut its workforce by 18%.
The layoffs are increasing uncertainty in the market as they are seen as a sign that companies are not expecting a rapid recovery in the cryptocurrency market. On the other hand, it is interesting to note that some cryptocurrency miners are selling their holdings. Smaller companies, in particular, are experiencing financial hardship and liquidating their Bitcoin holdings, as miners earn only 39% of their average revenue due to the drop in Bitcoin’s price.
Analysts are skeptical of the cryptocurrency market in this economic environment with geopolitical uncertainties, high interest rates and the continuing negative view of cryptocurrencies by major lawmakers and the risk of the economy falling into recession. ‘crisis of confidence’ states that a sustained bear market for cryptocurrencies is likely to be due to