- $69 billion was lost in the cryptocurrency market within a single day.
- Bitcoin prices plummeted by nine percent, hovering around the $20,300 mark.
- S&P 500 is down over four percent from last week.
According to reports, the cryptocurrency market has seen $69 billion of its value wiped out in 24 hours alone as leading cryptocurrencies continue an almost week-long sell-off.
Bitcoin dropped by nine percent to around $20,300, its lowest price since July 2021, while Ether dropped six percent to $1,611 its lowest price since late July. Bitcoin has also been compared to “digital gold,” a potential safe-haven asset and a hedge against rising prices.
According to a recent research note from JPMorgan, bitcoin may rise to $146,000 in the long term because it competes with gold as an “alternative” currency.
The financial analysts at JPMorgan added, however, that bitcoin would have to become considerably less volatile in order for this price target to be met. Bitcoin is well-known for its large fluctuations in value.
Stocks have been consistently dropping this year and just had their worst week since last March. Given that the Federal Reserve is likely to soon enact more restrictive monetary policy measures including higher interest rates, investors are selling riskier assets such as tech stocks.
For perspective, the S&P500 is down over four percent from last week and seven percent below its highs from only one month ago. The cryptocurrency market is often seen as a risky investment, but some believe that it could be a safe haven in times of economic turmoil.
In the past, when stock prices have dropped sharply, bitcoin’s price has tended to rise. This was most notably the case during the global financial crisis in 2008 and the European debt crisis in 2011.
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