Bitcoin hits the lowest since December ’20 in the middle of the “cryptocurrency winter”
It has been a difficult week for crypto investors.
After a brief drop to $ 20,293 per unit early Friday, the bitcoin (BTC-USD) price has fluctuated between $ 20,000 and $ 21,200 and is currently trading at $ 20,591, a loss of 2.37% in the last 24 hours and 29% in the last week.
Ether (ETH-USD), which is more intertwined with the crypto DeFi segment that has recently ruined the risk management strategies of significant industry players, is trading at $ 1,086 per coin, a loss of almost 3% on the day, and around 36% in the last week .
Crypto’s total market value has fallen by nearly $ 300 billion since last Friday’s hot inflation data, from $ 1.19 trillion to $ 893 billion on Friday afternoon, according to Coinmarketcap.
“We’re in a crypto winter,” Future Perfect Ventures partner Jalak Jobanputra told Yahoo Finance Live. Jobanputra notes that despite the significant decline in bitcoin, it has so far remained above $ 20,000, an important psychological level for buyer support.
“If we see more infection in the crypto markets and more funds begin to fail [things] may change, but I’m still thinking about [bitcoin] as the most blue-chip crypto that is not as prone to questionable risk management practices, “Jobanputra added.
Within the sector, a liquidity crisis has put pressure on a number of crypto hedge funds and lenders. Companies including Coinbase (COIN) have announced layoffs, while some companies have been forced to liquidate positions or freeze customer accounts.
Following the move by cryptocurrency lender Celsius Network to freeze all customer accounts, Babel Finance has also cooled trading, citing “unusual liquidity pressure” according to a customer note.
In the midst of the panic, several crypto companies including BlockFi, Genesis Trading and FTX have come out publicly and stated that they have liquidated certain handed over counterparties on their platform with some speculation and evidence pointing to Three Arrows Capital.
“Crypto is going through a classic deleveraging cycle, and it needs to continue that cycle until it reaches the bottom,” said Matt Hougan, chief investment officer at Bitwise. told Yahoo Finance Liveand adds that volatility will persist over the next few weeks.
However, some data shows that investors are still eager to find crypto-related exchange-traded products, with digital asset manager 21Shares reporting that they have seen $ 30 million in net inflows since Terra’s collapse in mid-May, with the majority going to Bitcoin-related products.
Other crypto movers
Major cryptocurrencies such as Binance’s BNB token (BNB-USD) down 24.63%, Solana (SOL-USD), down approx. 15%, Cardanos ADA token (ADA-USD), down 16%, Chainlink (LINK-USD), down 22%, Polkadots DOT token (DOT-USD), down 16%, Avalanches AVAX token (AVAX-USD ), down 29%, Tron (TRX-USD), down 24%, Polygon’s MATIC token (MATIC-USD), down over 34% have all seen losses in the last week.
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David Hollerith covers cryptocurrency for Yahoo Finance. Follow him @dshollers.
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