After a steep crash in bitcoin and other altcoins on January 6, the softness in crypto assets persists with bitcoin in trade today seeing a decline of 2 percent to quote at $42,200. This is following the earlier breach of levels below $41,000 with a loss of 5 percent.
This is in fact the lowest price of the largest crypto by m-cap and popularity since late September. Further, on the steep cut, bitcoin’s 1-week change has been at over 12 percent. Other altcoins too are seen trading lower with a drag of up to 5 percent as on Solana, while altcoins such as Ripple, Chainlink, Polygon and Internet Computer (up over 16 percent as for Cosmos).
The yesterday’s crash has come on account of the Fed’s hawkish minutes signalling to expeditiously end the corona led stimulus program as well as hike rates.
“Bitcoin has been trading as a risk-of/risk-off asset lately and seems to be tracking equities lower,” Jeff Dorman, CIO at Arca, told CoinDesk in a Telegram chat.
There is a view that Fed’s plans to reduce its balance sheet as well as raise rates at the same time could result in a long standing asset price deflation.
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Story first published: Friday, January 7, 2022, 15:09 [IST]