Cryptographic investors are working aggressively to raise rates from the Federal Reserve Board and exacerbate the liquidity crisis.
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Bitcoin Below $ 20,000 on Saturday expanded the brutal slide of cryptocurrencies.
Bitcoin prices have fallen 9% to $ 19,217.81 in 24 hours, according to Coin Metrics data. Bitcoin last fell below that level in December 2020.
The second largest token, Ether, plummeted 10% to $ 997.75, the lowest level since January 2021.
Cryptographic investors are working on aggressive rate hikes from the Federal Reserve Board and exacerbating the liquidity crisis that has driven key players into financial difficulties.
Wednesday Fed 75 basis point rate hikes, The largest increase since 1994. This has led to the withdrawal from all stripes of high-risk assets, including equities and cryptocurrencies.
Elsewhere, crypto space is still upset from the fallout of the $ 60 billion collapse of the two major tokens last month.
Terra, a so-called stablecoin that was valued at a dollar, crashed into a fraction of a cent with a related coin called Luna.$ 3 billion crypto lender Celsius this week Stopped withdrawalLock out users from funds and raise the risk of facing bankruptcy.
Celsius behaves like a bank, acquiring investor cryptocurrencies and lending them to institutions, creating a return on deposits. We have many assets in the so-called decentralized financial space.
“We are acting for the benefit of our community,” said Celsius, who did not return multiple requests for comment.
Another major player, Three Arrows Capital, is in the midst of its own liquidity crisis. The $ 10 billion crypto hedge fund is reportedly on the verge of bankruptcy after a plunge in the crypto market has reduced its holding value.
3AC is an investor in Terra and has leveraged bets on numerous tokens including Bitcoin, Ether and Solana.
“We are in the process of communicating with stakeholders and we are working hard to resolve this,” said Zu Shu, co-founder of the company. On Friday, he told The Wall Street Journal that 3AC is considering selling assets and bailouts by another company to avoid a collapse.
Three Arrows Capital did not respond to CNBC’s request for comment.
