 "Cryptocurrency")
The cryptocurrency market has plunged deep into the red over the last seven days, due to global macroeconomic uncertainties, experts told Business Standard. Bitcoin, the largest digital token by market capitalisation, has declined over 10 per cent in the last week, trading at $26,410 on Friday, according to CoinMarketCap.
Ethereum, the second largest token, was down nearly 9 per cent, trading at $1,684. Other major tokens like Cardano and Solana also fell by 10 per cent.
"Crypto markets have come under severe selling pressure, as global macro uncertainties have resulted in a 'risk-off' sentiment. Most tokens are trading at sharply lower prices, with the overall crypto market capitalisation remaining just above $1.1 trillion. Market leaders, Bitcoin and Ethereum, broke important anchored price levels which they had been trading around for weeks, and are now trading below $27,000 and $1,700 levels respectively, down almost 10 per cent since last week," said Parth Chaturvedi, investment lead at CoinSwitch Ventures.
He added, "Along with this, the minutes released by the Federal Open Market Committee attracted attention, outlining concerns about inflation and the potential necessity of raising interest rates. The ongoing apprehensions surrounding China's economic landscape further added to the downward pressure on Bitcoin's prices."
The co-founder and chief executive officer of Mudrex, Edul Patel, also highlighted the uncertainty around the Chinese economy, where the real estate crisis has escalated after Evergrande filed for bankruptcy protection in New York, contributing to the sell-off in the markets.
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"More broadly, all 'risk-on' assets, including equities, have fallen in price as the macro conditions get murkier, with China experiencing a slowdown in internal consumption and announcing a surprise interest rate cut," Chaturvedi added. He also noted that the Evergrande news alone wiped off $1 billion worth of Bitcoin and Ethereum.
Furthermore, Elon Musk's SpaceX reportedly sold Bitcoin holdings worth $343 million, pulling the token's price down.
In the realm of altcoins, the much-anticipated launch of SHIB's Shibarium, as an Ethereum layer 2, was marred by a bridging disaster, resulting in $2.5 million worth of bridged Ethereum getting lost, leading to a sharp sell-off in SHIB prices.
According to the research team of crypto exchange CoinDCX, SHIB experienced a decline of over 8 per cent last night.
"This downturn translated to a reduction of approximately $500 million in its overall market capitalisation," the team stated.
