- Bitcoin had slipped to US$21,095, well below its most recent level of support at US$22,000 and actively testing a new support at US$21,000.
- Cryptocurrency markets have recovered somewhat since the initial rout from the collapse of algorithmic stablecoin UST and its sister token Luna, but are still some 70% off their all-time-highs.
In further signs that Bitcoin is maturing as an asset class, the benchmark cryptocurrency buckled under pressure and expectation that the U.S. Federal Reserve will weigh in with another monster-sized rate hike this week.
At the time of writing, Bitcoin had slipped to US$21,095, well below its most recent level of support at US$22,000 and actively testing a new support at US$21,000.
So-called altcoins fell more sharply compared with Bitcoin, including Ether, Avalanche and Solana, which had only recently notched double-digit percentage returns, outpacing gains in Bitcoin.
Over the past several weeks, cryptocurrencies had defied expectations, by decoupling somewhat from other risk assets, in particular Bitcoin, which fell to its lowest rolling 60-day correlation versus the Nasdaq 100 since January.
However, riskier investments lost steam ahead of the Fed meeting this week, with an interest rate hike expected later tomorrow and a slate of disappointing earnings from some of America’s biggest technology companies against a slowing economy and soaring dollar.
Tech shares once again dragged down Bitcoin and the two asset classes regained their strong correlation, but some analysts suggest that the worst is over for Bitcoin, after a selloff this year saw over 50% of its value wiped off.
The cryptocurrency sector is having to contend with several headwinds, not least of which is the ongoing fallout from the highly public failure of several large cryptocurrency lenders, including Celsius Network and hedge fund Three Arrows Capital.
Cryptocurrency markets have recovered somewhat since the initial rout from the collapse of algorithmic stablecoin UST and its sister token Luna, but are still some 70% off their all-time-highs.
