The value of cryptocurrencies is even more thrilling as the wider flight resumes from the risk of rising concerns about an inflation-led global recession.
The collapse of the value of the so-called stablecoin, TerraUSD, has been widely blamed for triggering the sale of crypto assets as Bitcoin hit a 20-month low on Thursday.
After TerraUSD broke the peg to the US dollar, the largest cryptocurrency in market value reached a low of just over $ 25,400.
Stablecoin (so named because such digital tokens are fixed to the value of traditionally regulated assets) plummeted late Wednesday and others such as tethers. I sent a shock wave through a lot of assets.
Bitcoin has lost almost two-thirds of its peak of $ 69,000, which was achieved last November.
Its demise has tracked the so-called growth of Wall Street, primarily the demise of tech stocks.
This year, Amazon, Meta (Facebook owner, Alphabet (Google’s fame), Tesla and others have led the recovery of Wall Street from the 2020 pandemic lows, while their returns and ratings are discounted. It bears the brunt of sold out. It gets deeper as interest rates rise.
The Federal Reserve has shown a positive path to raising rates to tackle rising inflation. This could reflect a 0.5% increase this month at several meetings this year.
Such tightening prospects in the coming months also sent the dollar to its 20-year high, with the pound falling below $ 1.22 at its two-year low, but the U.S. economy may suffer as borrowing costs rise. There was also growing concern. ..
Despite the Bank of England warning Risk of future recession For the UK economy last week, we continued to bid to curb inflation expectations by raising bank rates four times in a row to reach 1%.
The blockade of COVID in China is contributing to economic turmoil, as global supply chain turmoil can also accelerate inflation.
It is already being driven by demand over supply and the effects of the Russian war in Ukraine, damaging the appetite of risk.
Russia is now using energy as a “weapon” as Moscow said in recent developments to hurt emotions that it would stop the flow of gas to the country via the main pipeline through Poland. There was a warning from Germany that there was.
The FTSE 100, DAX in Germany and CAC in Paris all fell by more than 2% at some point and the Asian market was on Thursday. London’s Premier Index finished a day 1.6% lower.
Tech-intensive Nasdaq, which lost more than 25% of its value this year, fell another 1% with extensive sales.
Susannah Streeter, Senior Investment and Market Analyst at Hargreaves Lansdown, said of the market collapse:
“Cryptographic fans, who were falsely reassured by the sharp rise in prices during the pandemic, suffered a full recovery in assets as Ether fell by just under 20%, despite a slight recovery from yesterday. Faced with a rude awakening. The last few hours.
“Bitcoin has returned from the $ 26,000 low that it reached earlier today and is currently trading over $ 28,000 in Nudge, but has fallen 20% in the last five days.”