Crypto market shrinks after another $350 billion was wiped out over the weekend, with bitcoin at 6-month low

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Cryptocurrencies sank on Monday, helping to lower the total market value by $400 billion last week.

Bitcoin and Ethereum both hit lows not seen since July as cryptos followed the fall in stocks.

Altcoins are suffering even more, with solana down 40% in the past seven days after another outage.

Cryptocurrency prices fell on Monday, after $350 billion was wiped off the total market value over the weekend, as the prospect of an aggressive Federal Reserve kept jitters alive.

According to data from CoinMarketCap, leading digital currency Bitcoin has fallen almost 6% in the past 24 hours to $33,561, more than 50% below its November all-time high of $68,790. Ethereum suffered heavier losses of more than 10%, falling to $2,219.

Over the weekend, the overall cryptocurrency market lost $350 billion, bringing its decline over the past seven days to $400 billion. It is now worth around $1.60 trillion, after peaking at nearly $3 trillion in mid-November, according to CoinMarketCap.

Cryptocurrencies suffered steep declines last week as they trailed stock markets lower, rocked by concerns over the prospect of a series of interest rate hikes by the Federal Reserve this year. Bitcoin and Ethereum have fallen 22% and 32% respectively in the past seven days.

Higher rates tend to weigh on more speculative assets, as investors are more likely to put their money in areas of the market they perceive to be less risky.

“I’m sure the tech savvy, crypto bros, and early Meta users who walk around in headsets wondering where the others are will try to reboot, but it looks like a crash at the moment, before we even get started. We were getting to the regulatory blue screens of death,” Michael Every, global strategist at Rabobank, said in a note.

Altcoins saw more severe falls than major coins. Cardano has fallen 13% in the past 24 hours to $0.97, and it has lost 36% in the past seven days. Meanwhile, solana fell 18% to $83.12 and posted a weekly loss of 42%.

These so-called “ethereum killers” made gains in 2021 as some analysts said ethereum was losing ground as a base for decentralized finance, or DeFi, applications. But the gains were wiped out in this latest crash.

The story continues

Solana’s price plummeted as its reputation took a hit, after its network suffered its second outage in January over the weekend.

Crypto prices tracked the decline in stocks throughout January. Worries over Fed interest rate hikes and rising inflation levels sent shivers through markets, with the S&P 500 down nearly 10% year-to-date and the wealthy Nasdaq in technologies, entering correction territory.

Investors are bracing for the Fed’s policy meeting on Wednesday to hear whether the central bank plans to get even more aggressive than the four interest rate hikes the market is expecting this year as it tackles lows hot inflation.

The crypto crash could see famous bitcoin supporters lose, with NFL stars like Odel Beckham Jr. and Aaron Rodgers’ decision to take half their salaries in bitcoin coming under scrutiny renewed.

Not all crypto enthusiasts seem worried, and bitcoin bull and Galaxy Digital boss Mike Novogratz took to Twitter to point out past patterns in reassurance.

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