Bitcoin lost half its value; down 50% from its peak to below $30,500
The turmoil in the stock market turmoil continues to spill over into the cryptocurrency markets. Just last week, Bitcoin was trading at a little over $36,000. Now, the world’s most popular cryptocurrency has shed all its gain and has fallen by another $3,000.
Today, Bitcoin is now trading at levels not seen since July 2021. The continued stock sell-off has pushed investors to also dump crypto and Bitcoin fell below $32,000, falling below the key psychological level of $33,000 after reaching a recent high of almost $40,000 last week. As of the time of writing, Bitcoin has climbed back above $33,000.
Bitcoin is not alone. The carnage also spread to other altcoins including Ether, Solana, and Cardano, wiping off billions of dollars from the crypto market, according to data from CoinMarketCap. Ether fell about 5% to $2,402.70.
So, what’s really going on? According to Wall Street analysts, a lot has to do with a major stock sell-off in the U.S. that later spooked the cryptocurrency market. On Thursday, the Dow Jones Industrial Average lost more than 1,000 points, marking its worst single-day drop since 2020.
The second reason has to do with the Fed raising the interest rates by 0.5% to prevent the U.S. economy could go into a recession. The impact of the interest rate hike is further proof that cryptocurrencies are not safe-haven assets that keep their value during the economic downtown.
Meanwhile, Michael Saylor, the founder of the Virginia-based MicroStrategy pokes fun at himself in a tweet showing him flipping burgers at Mcdonald’s.
Monday morning is time to get back to work. #Bitcoin pic.twitter.com/JlufLXRT9W
— Michael Saylor⚡️ (@saylor) May 9, 2022
As we reported early last month, MicroStrategy recently purchased additional 4,167 bitcoins for about $190.5 million at an average price of $45,714 per bitcoin. The company now owns a total of approximately 115,110 bitcoins, making the company one of the top ten largest bitcoin holders in the world. At the current price of bitcoin, it means Microstrategy is now in the red.
3:22 PM EST Update: Bitcoin dropped more than 10% on Monday, losing more than 50% of its value. As of the time of writing, Bitcoin dipped below the $31,000 market after touching a recent high of $40,000 last week. As of the time of this update, the price of Bitcoin is now hovering at $30,678.