Crypto Industry Fears Contagion If Bitcoin Price Drops Below 20,000
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On Monday, the cryptocurrency industry was sidelined as Bitcoin struggled to stay above critical levels, as investors feared very difficult market chaos for major crypto firms.
The cryptocurrency industry was on edge on Monday as Bitcoin struggled to stay above a key level, leading investors to fear that problems with major crypto players could lead to a major change in the market.
Bitcoin, the world's largest cryptocurrency, traded well below the 20,000 token mark during opening hours in London - its first record peak around 2017.
Bitcoin dropped to just 17,592.78 on Saturday, below $20,000 for the first time since December 2020. It has lost nearly 60% of its value this year and 37% this month in the collapse of the new crypto sector alone.
The decline is due to problems with several key stakeholders in the industry. Market players say further declines could have a spillover effect as some crypto investors are forced to sell their holdings to cover margin calls and losses.
The founders told The Wall Street Journal in a story published on Friday, the same day Babylon, the cryptocurrency lender in Asia, Three Arrows Capital is exploring options, including selling the assets and another separate company. They shot them. .....
US lender Celsius said this month it would suspend customer withdrawals. In a blog post on Monday, Celsius said it would continue to work with regulators and authorities, but would suspend customer question-and-answer sessions.
“More credit is released into the system, and if lenders are forced to absorb losses on Celsius and Three Arrows, they will reduce the size of their future loan books, which means the total amount of credit available in the crypto ecosystem.” The amount has fallen significantly, said Adam Farthing, head of risk for Japan at crypto liquidity provider B2C2.
"It feels like 2008 to me how the effects of depression and the dominance of interest exist," Farting said.
Smaller currencies, often in conflict with the bitcoin, were also attacked. The 2 ether mark was at 1.0752, after going from 1,000 to 1,000.
During the week.
The downturn in the cryptocurrency markets has been accompanied by a sharp fall in the currency as US stocks have plunged the biggest weekly decline in two years amid fears of rising interest rates and the possibility of a crisis escalating.
Bitcoin moves follow a similar pattern for other risky assets, such as technology stocks.
The total market cap of cryptocurrencies is approximately 7.877 billion, up from 2.2.9 trillion in November 2021, according to the pricing website Coin market cap.
The decline in stable coins - a form of cryptocurrency designed to maintain a constant value - means that investors are withdrawing money from the entire industry.
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