Bitcoin continued its decline on Saturday, weighed down by investors’ lack of risk appetite, falling as low as $18,740, down 9% from the previous day. This is the lowest level since December 13, 2020.
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Since its all-time high on November 10, 2021 at $68,991, the digital currency has lost over 72% of its value. As of 15:50 GMT, it was at $18,941, down 8% from Friday.
A sign that the liquidation continues in this market in full crisis, all major cryptocurrencies fell sharply on Saturday. Ether, the second most used digital currency, lost almost 10%.
Stock markets tumbled this week, concerned by the idea that central banks, led by the Fed (US Federal Reserve), would not be too aggressive in their desire to curb inflation and risk weakening the global economy.
But it is cryptocurrencies that pay the highest price. On Monday, the cryptocurrency market fell below the symbolic $1 trillion ceiling. It rose to 3 trillion last November.
Bitcoin’s fall was accelerated by the suspension of withdrawals by two cryptocurrency investment platforms.
Celsius announced a pause in withdrawals and transfers on Sunday evening. This company, which, according to its website, managed $12 billion worth of assets in mid-May, notably offered its users to place their “historical” cryptocurrencies, such as bitcoin and ether, to invest in new virtual currencies.
Babel Finance, meanwhile, told customers on Friday that it was suspending all withdrawals due to “unusual liquidity pressures”.
A brief freeze on Bitcoin withdrawals from the world’s largest exchange, Binance, also contributed to a lack of appetite for cryptocurrencies this week.
Cryptocurrency platform Coinbase announced on Tuesday that it would cut 18% of its workforce, or around 1,100 jobs.
“It looks like we’re about to enter a recession after more than 10 years of economic boom,” said the company’s co-founder and CEO, Brian Armstrong, in explaining the massive layoffs.
“A recession could result in another ‘crypto winter’ and last for a longer period of time,” he added.
By 2021, this fledgling sector had increasingly attracted more traditional financial players, whose appetite for risk was fueled by ultra-loose policies from central banks around the world.