A representation of Bitcoin is seen in front of a stock chart in this illustration taken on May 19, 2021.
Dado Ruvic | Reuters
The crypto market has seen around $130 billion wiped out in the past 24 hours as major cryptocurrencies continue to sell off for days.
Bitcoin was down about 6% at $33,352.50 as of 6 a.m. ET, according to CoinDesk data, its lowest level since July 24, 2021. Bitcoin is down about 51% from its all-time high. in November.
Ether fell 12% to $2,218.37, its lowest level since late July, according to CoinDesk data. Ether is down about 53% from its all-time high in November 2021.
Movements in Cryptocurrencies Are Related to sell riskier assets like tech stocks as investors brace for tighter monetary policy from the US Federal Reserve and higher interest rates.
“BTC (bitcoin) and crypto have been much more reactive, based on the nature of the asset class and we are likely to test 30-32k based on current sentiment and momentum,” Vijay Ayyar, vice president of corporate development and international expansion, told CNBC by text message.
Ayyar said that if bitcoin holds above $30,000 for a longer time frame, such as a week, there could be a base formed at those levels before the market moves higher.
“But for the market to really go up, it will take some time, given the lack of confidence across the entire market,” added Ayyar.
Investors are also grappling with higher inflation. Bitcoin advocates often argue that the digital currency is a hedge against inflation, but that theory has so far not been accepted. Analysts said there is a concern that a more hawkish Fed could blow the sails of the crypto market.
Meanwhile, investors are also assessing the impact of further regulation on the crypto market. Last week, Russia’s central bank proposed Prohibit the use and mining of cryptocurrencies.
