Wednesday, Sep 28, 2022
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Bitcoin value drops by 50%, lowest in a year

IFM_Bitcoin devaluation-image
The fall of the world's largest cryptocurrency by market capitalization coincides with a global stock market sell-off.

According to the Coinbase cryptocurrency exchange, the value of Bitcoin has plunged below $31,000 (£25,140), less than half of what it was at its high in November.

The fall of the world’s largest cryptocurrency by market capitalization coincides with a global stock market sell-off. Key European, Asian, and US markets all fell again on Monday. Investors are replacing risker assets with safe havens such as the dollar.

The Nikkei market in Japan fell 2.5%, while the FTSE 100 in London fell more than 2%. In the United States, the Dow fell nearly 2%, the S&P 500 fell 3.2%, and the Nasdaq fell 4.3%, extending recent losses.

Uber was one of the companies that contributed to the downslide. The company’s stock plunged more than 11% after media sources reported that CEO Dara Khosrowshahi had warned staff that investors were becoming more cautious about investments. Uber would respond by cutting costs and limiting hiring, he said.

When markets are volatile, traditional investors may typically sell riskier assets, such as digital currency, and put their money into safer investments. Professional investors, including hedge funds and money managers, have been more involved in trading what was formerly the domain of individual investors and enthusiasts, causing cryptocurrency markets to follow wider trends.

Bitcoin’s price has dropped more than 10% in the previous day and more than 20% in the last week, accounting for over a third of the cryptocurrency market with a total worth of close to $570 billion.

Ethereum, the world’s second-largest cryptocurrency, has also dropped in value, losing more than 20% in the last week.

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