Bitcoin (BTC) price drops to its lowest level in 3 months

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Chukrut Budrul / SOPA Images / LightRocket via Getty Images

Bitcoin fell to a three-month low Thursday night amid nervousness over a tightening of US monetary policy and an internet shutdown in Kazakhstan, the second-largest bitcoin mining hub in the world.

The price of bitcoin fell to $ 41,222.41 just after 9 p.m. ET on Thursday, reaching its lowest level since September 29, according to data from Coin Metrics. It was last traded down 0.6% at a price of $ 42,391.20 on Friday morning.

The world’s largest cryptocurrency started falling earlier this week after minutes from the Federal Reserve’s December meeting hinted that the U.S. central bank would slow its pandemic-era stimulus.

The hawkish comments sparked a sell off in global stock markets that spilled over to cryptocurrencies. Bitcoin bulls often describe it as an asset that is uncorrelated to traditional financial markets, but experts have noticed increasing parallels in the price movements of bitcoin and stocks.

Other digital currencies continued to decline on Friday, with Ethereum losing 2.3% and Solana falling 4.7%.

Another news weighing on crypto prices is the decision of the President of Kazakhstan to shut down internet service following deadly protests against the government.

The Central Asian country accounts for 18% of the processing power of the bitcoin network, according to the Cambridge Center for Alternative Finance. Many crypto miners have fled China for neighboring Kazakhstan because of Beijing’s ban on virtual currency mining.

The Internet shutdown in Kazakhstan has taken up to 15% of the network offline, according to some estimates.

The computing power of Bitcoin “is not directly correlated with the price of Bitcoin, but it gives an indication of the security of the network, so a drop may scare off short-term investors,” said Marcus Sotiriou, analyst at GlobalBlock, a UK based digital asset broker. in a note Thursday.

– CNBC’s Mackenzie Sigalos contributed to this report

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