Bitcoin’s sell-off accelerated Tuesday, sending it below $30,000 for the first time in nearly a month, and dragging other cryptocurrencies down.
and fell Biggest Cryptocurrency at around 6% and was trading at about $29,700 in the morning in London. Other cryptocurrencies, including Ether, which ranks second, are down about 9%, while Ripple is down 10%, according to CoinDesk data.
About $100 billion from the entire cryptocurrency market was wiped out within 24 hours, according to CoinMarketCap data.
Some traders considered $30K as a major support level that may open the way for further losses if broken. Further big falls could upset the cryptocurrency market and exacerbate a broader exodus of risky assets such as stocks, at a time when global stocks are falling due to fears of slowing economic growth and the continued spread of the delta-variable coronavirus.
“We will need to form another base first before resuming another uptrend,” said Vijay May, head of Asia Pacific at crypto exchange Luno in Singapore. “We will be between $20,000 and $40,000 for the rest of the year.”
The narratives that pushed Bitcoin to a record high in mid-April at nearly $65,000 are now being questioned. Some have argued that the digital asset could act as a hedge against inflation due to limited supply, but Bitcoin’s 2% advance this year lags the S&P 500’s 13% advance.
“Crypto investors know that volatility is going to be a part of it,” Michael Sonnenchin, CEO of Grayscale Investments, said in an interview on Bloomberg TV.
Bitcoin has been hit by several setbacks recently, including a Chinese regulatory crackdown – in part due to concerns about rising energy consumption – and advances in central bank digital currency projects that could put pressure on private cryptocurrencies.
The creator of Dodge Coin recently criticized the cryptocurrency as a hoax, and the appetite for speculation is generally waning.
Officials around the world are also ramping up scrutiny of cryptocurrencies. On Monday, US Treasury Secretary Janet Yellen pushed top financial regulators to expedite their consideration of new rules to monitor so-called “stable cryptocurrencies”.