At $15,649, Bitcoin has reached its lowest price since November 2020, according to CoinGecko data.
The latest price crash represents a drop of over 26% from $21,418 on November 5, before word of some of FTX’s financial problems leaked out.
The news comes as markets reel from continued fallout and cross-contamination from FTX’s fall into bankruptcy. Various high-profile celebrities, for example, has been caught up in a lawsuit to promote the exchange. Crypto firms like SALT, Liquid Globaland BlockFi have all stopped withdrawals, citing exposure to FTX’s collapse.
Especially Crypto prime broker Genesis is also reportedly considering bankruptcy after closed withdrawals last week.
In accordance sources reported by Bloombergthe lender had spoken to the private equity company Apollo Capital and crypto exchange Binance on funding and sought to raise $1 billion to fix the liquidity crisis.
A representative of the lender said Decrypt: “We have no plans to file for bankruptcy immediately” and that the goal “is to resolve the current situation by consensus without the need for any bankruptcy filing.”
Genesis pointed to the sudden increase in customers looking to cash out their assets in the immediate collapse of FTX as the main reason for their current financial woes.
Bitcoin on the ropes
In addition, both regulatory and market pressures contribute to Bitcoin’s historically poor performance.
Fidelity, one of the world’s largest institutional investors and the largest provider of US 401(k) savings accounts, hair also recently come under new scrutiny from some US politicians for dropping their 401(k) Bitcoin plan.
Senators Elizabeth Warren of Massachusetts, Tina Smith of Minnesota and Richard Durbin of Illinois all signed a letter saying that FTX’s recent bankruptcy “has made it abundantly clear that the digital asset industry is in serious trouble.”
The Boston-based firm, which has about $9.9 trillion under management, had planned to do so launch its own Bitcoin and Ethereum based trading app.
Elsewhere in the market has a report from CoinShares found that cryptocurrencies receive the largest inflows of short-term investments on record.
The report found that while there was an inflow into Bitcoin-related investment products of $14 million, about 75% of that inflow came from speculators who bought products that allowed them to short Bitcoin.
While Bitcoin hasn’t exactly been stable over the past few years, the recent post-FTX market crash surpasses the impact caused by any other market crisis this year.
The collapse of algorithmic stablecoin terraUSD in June and the subsequent collapse of crypto lender Celsius caused Bitcoin prices to crash to a low of $33,263 in July 2022, a huge drop from its all-time high of $69,045 on November 10, 2021, but still well above today’s levels.
Disclaimer
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.
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