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Saturday, October 1, 2022

Bitcoin falls to 9-month low, drags down other cryptocurrencies

The price of bitcoin plunged to its lowest level in more than nine months on Monday, weighed down by investor fears and dragging other cryptocurrencies down with it. 

After a record-breaking 2021, bitcoin is facing several difficulties in 2022: with its 4.3% drop on Monday to $32,762 around 11h25 GMT, it has lost almost a third of its value so far this year and more than 50% since reaching its all-time high.

“There is a correlation with risk assets that is evident, especially the Nasdaq,” the U.S. stock index that groups numerous technology companies, said Neil Wilson, an analyst at Markets.com.

Those assets are undermined by the prospect of a tightening of monetary policy in the United States, as the spigot of abundant liquidity that had fueled a surge in valuations will be turned off with rate hikes by the U.S. Federal Reserve (Fed).

Like bitcoin, the other cryptocurrencies also suffered losses. For example, Ethereum’s value was down 7.4% to $2,382 on Monday affecting the NFT market which largely trades with this cryptocurrency.

According to the Coingecko portal, which monitors the valuation of more than 13,000 cryptocurrencies, the market now represents just over $1.5 trillion, down from more than $3 trillion last November, when it peaked. 

This is certainly having an adverse impact on countries like El Salvador who have made bitcoin legal tender and giving other countries who are thinking of doing the same reason to pause.



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