Bitcoin drops below $18,300 as sell-off accelerates — here’s what happened

As of mid-afternoon on Saturday, the price of ether was $94 and the price of bitcoin was $18,248. The world's two most popular Cryptocurrencies are down more than a third in the past week.

Pressure from macroeconomic forces, including inflation and a succession of Fed rate hikes, is part of the reason for the increase in the price of cryptocurrencies. We have seen the blue chipcryptocurrencies go down. It doesn't help that some of the most popular names in the industry are facing solvency crises.

How did we get here?

Celsius CEO Alex Mashinsky.

At one point in the day, the price of bitcoins fell as much as 18%. The winter seemed to be here.

Celsius shocked the market when it announced that all withdrawals, swaps and transfers between accounts have been paused due to extreme market conditions.

Concerns about the platform's solvency were raised after Celsius locked up its $12 billion incryptocurrencies. The news reminded people of what happened in May when a failed U.S. dollar-pegged stable coin project lost $60 billion in value.

Users could get a yield of up to 18.63% on their deposits. It is similar to a product a bank would sell.

The high yields came under scrutiny.

"This risk certainly seems like it's just the beginning", said John Todaro, vice president ofcryptocurrencies and blockchain research.

The underfunding situation that could happen with centralized borrowers and lenders should not be seen as a result of the Defi protocols. There could still be a lot of liquidations with that collateral being sold off on De Fi protocols.

People watch as the logo for Coinbase Global Inc, the biggest U.S. cryptocurrency exchange, is displayed on the Nasdaq MarketSite jumbotron at Times Square in New York, U.S., April 14, 2021.

The price of ether was around $1,100 and the price of bitcoins was around $22,000.

A growing number of companies are cutting staff to try to shore up profits as investors assess the effects of Celsius.

The company said it was laying off 20% of its workforce. In the hopes of stabilizing its business, the company cut spending and withdrew job offers.

The president and COO said that the recent inflation report surprised many people.

Given the current state of the economy, it feels like the most prudent thing to do at the moment.

As investors move out of riskier assets, the cost of doing business is going to go down.

In a first for the U.S.-basedcryptocurrencies exchange and custodian, Gemini laid off 10% of its workforce, as well as announcing a staff reduction of 260 people.

Michael Saylor, chairman and chief executive officer of MicroStrategy, first got into bitcoin in 2020, when he decided to start adding the cryptocurrency to MicroStrategy’s balance sheet as part of an unorthodox treasury management strategy.

Michael Saylor, the CEO of MicroStrategy, appeared on CNBC to talk about his firm's $4 billion bet on the virtual currency. MicroStrategy is the first and only bitcoin spot exchange-traded fund in the U.S.

In March, Saylor borrowed $205 million using his bitcoin as a security and then bought more of the currency.

We have billions of dollars in bonds. We borrowed a lot of money. I don't want people to take a high-yield loan. Saylor said that Marathon Digital took out a credit line with Silvergate Bank, which is a publicly traded company.

The investors were worried that the company would have to put up more money for its loan, but Saylor said that was not true.

The margin call is unimportant according to Saylor. The margin loan is well managed and we feel like we have a fortress balance sheet.

The Federal Reserve raised its benchmark interest rates three quarters of a percentage point on Wednesday. According to the Fed, the move was made to curb high inflation.

The initial rally on the news was short-lived.

Bitcoin and and other cryptocurrencies are in free fall.

On Thursday, we were in the red. It hadn't seen prices like that since the end of the year.

The losses were tied to a sell-off on Wall Street, in which the blue chip index fell 700 points.

Some say it could take time for Cryptocurrencies to recover from the sell-off in riskier assets, as investors can't shake the fears of recession.

The co- founder and chief strategy officer of Espresso Systems thinks that we are in a long drawdown period.

She thinks that the industry will have to build real utility by taking the stairs back up after taking the elevator down.

What we are seeing is a washout.

As an investor, one doesn't want to be in a market where it's being driven by just short-term price action, by speculation, and as a builder, one doesn't want to be in a market where it's being driven by just short term price action

Bitcoin and other cryptocurrencies fell sharply as investors dump risk assets. A crypto lending company called Celsius is pausing withdrawals for its customers, sparking fears of contagion into the broader market.

There is no sign of slowing down in the markets, as the sell-off in ether continues at a rapid rate.

As businesses face questions about insolvency, this comes as a result.

The CEO of Paxos said that they had financial instability because of the opaque leverage.

This is a story that has been going on for a long time. You're lending and borrowing at the same time. It is unfortunate that people lost money, and I think it will set back the space because you will lose some early adopters or people who are new to the space.

The investors are still looking for good investments.

The fundamental technology here and the adoption curve that we see, the institutions that are coming in, how you can get your financial system to operate at the speed of the internet, those are things that need to happen