• Sat. May 21st, 2022

Bitcoin drops to 22-month low as stock markets tumble

ByHazel R. Lang

May 9, 2022

HONG KONG/LONDON: Bitcoin fell to its lowest level since July 2021 on Monday as the stock market crash continued to hurt cryptocurrencies, which are currently trading online with so-called riskier assets like stocks technologies.

Bitcoin fell to $32,763.16 shortly before 11:00 GMT, in its fifth consecutive falling session.

The cryptocurrency has fallen 13% so far in May and has lost more than half of its value since hitting an all-time high of $69,000 in November last year.

“I think anything in crypto is still classified as a risk asset, and similar to what we’ve seen with Nasdaq, most cryptocurrencies are under fire,” said Matt Dibb, COO of Singapore-based crypto platform Stack Funds.

The Nasdaq, a tech heavyweight, fell 1.5% last week and is down 22% year-to-date, hurt by the prospect of lingering inflation forcing the US Federal Reserve to hike rates despite slowing growth. Nasdaq futures fell another 2.3% on Monday.

Dibb said other factors behind the weekend’s decline — bitcoin closed around $36,000 on Friday — were the crypto market’s notoriously low liquidity over the weekends, as well as short-lived fears. that the algorithmic stablecoin called Terra USD (UST) may lose its dollar peg. .

Stablecoins are digital tokens pegged to other traditional assets, often the US dollar.

UST is being closely watched by the crypto community both because of the new way it maintains its 1:1 dollar peg and because its founders laid out plans to build a $10 billion reserve of bitcoins to support the stablecoin, which means volatility in the US could potentially spill over into bitcoin markets.

Ether, the world’s second-largest cryptocurrency, which underpins the Ethereum network, fell to $2,360 on Monday, its lowest since late February. -Reuter

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