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A runner wears a hat with a large bitcoin symbol on the side during day five of Royal Ascot at Ascot Racecourse on June 19. Photo: Steven Paston / PA Images via Getty Images
The crypto market was deep in the red on Monday morning, extending a sell-off that started late last week and accelerated over the weekend.
Bitcoin (BTC-USD), the world’s largest cryptocurrency, fell 7.1% to $ 32,969 (23,688) as of 8:20 a.m. in London on Monday. It marked the lowest level for bitcoin in almost two weeks.
Other major tokens were also in the red, with Ethereum (ETH-USD) down 7.8% to $ 2,028 and XRP (XRP-USD) down 7.3% to $ 0.69. Dogecoin (DOGE-USD), the mainstream prank token earlier this year, fell 8.8% to $ 0.25.
As of Monday morning, the entire crypto market had lost 6.8% of its value in the past 24 hours, according to data provider CoinMarketCap.
The massive sell-off extends a collapse that began late last week after the US Federal Reserve took an unexpected hawkish tilt at its last policy meeting. The central bank has advanced the timing of future interest rate hikes, raising concerns that the cheap money will disappear sooner than expected.
The Fed’s change in stance triggered a drop in risk assets and cryptocurrencies were taken into the selloff. CoinDesk reported that Bitcoin fund holdings hit their lowest level in four months on Friday following the Fed meeting.
“The money comes from the Fed and then flows through the markets,” Mati Greenspan, founder and managing director of Quantum Economics, told Yahoo Finance UK. “Now that they are talking about slowing the pace of new money, or at least signaling that the stimulus is not endless, investors are starting to wonder what the true value of these assets is.”
Headlines about the ongoing Chinese crackdown on cryptocurrency didn’t help sentiment over the weekend. The Block, a cryptocurrency industry website, reported that regulators in Sichuan Province issued a statement ordering crypto miners in the region to shut down.
“For some reason traders are focusing on Chinese news and how China continues to take a tougher stance on Bitcoin miners,” said Naeem Aslam, chief market analyst. at Avatrade.
Watch: What are the risks of investing in cryptocurrency?
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