When a currency requires government-issued currency to determine its value, what happens? The price of the digital currency fell to its lowest level in more than a year.
According to multiple outlets this past week, the popularcryptocurrencies has lost a lot of its value. According to the company, the price of the digital currency fell as low as $17,607.58 on Saturday.
According to a market analyst speaking to the Wall Street Journal, the break of the $20,000 price level was a long time coming.
Techcrunch reported that the total global market cap of cryptocurrencies fell below $850 billion on Saturday. According to Techcrunch, one of the most popular cryptocurrencies, ether, is down 80% since its record high. The price of ether is half of what it was a month ago.
It's a difficult time for speculative assets when there's a recession and this latest crash is coming during a tough time for the sector. Celsius, a leading lender in decentralized finance, announced on its website that it was suspending all transactions. Stan Schroder does an excellent job explaining why the crash happened and why the Feds raised interest rates.
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The crashing of the digital currency can be seen as important. According to The Washington Post, there could be more sell-offs in the market as investors lose confidence in thecryptocurrencies. According to the report, experts don't know where the bottom is for the digital currency due to how new it is.
It doesn't look good for anyone who's invested in the past year.
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