Cryptocurrencies have been seeing a new low during the current slowed-down economic climate which has made Bitcoin (BTC) breach the $27,000 mark and it lost value by 7.80 percent. It hit a low of $26,700. These levels were last seen in December of 2020 and are one of the major reasons behind the current fall in global inflation.
“The reason that this particular decline is occurring right now is that [crpyto] market narratives have shifted from risk-on to risk-off”, said Dr. Richard Smith, author of the Risk Rituals Newsletter. “Liquidity is drying up as the Fed and other central banks start to taper excess stimulus, and also as regular folks start to realize that Covid-19 is winding down, that we are going to go back to work and that we’re not all buying NFTs and moving into the metaverse tomorrow”.
Dips have not only affected the value of each BTC but also other cryptocurrencies such as Ether, which have faced an even bigger loss. ETH saw losses of 13.87 percent as it opened trading at $2,163 (approx Rs 1.65 lakh). Most of the cryptocurrencies are struggling to move up the price charts following the dip that began in the start of this week. As for BTC, the oldest cryptocurrency has fallen by up to 60 percent since its peak value in November of 2021. CoinMarketCap shows that the value drop for Bitcoin went till $26,350 in the last 24 hours.
Only a few stablecoins such as Tether, USD Coin, and Binance USD have managed to show some recoveries that are very minor in nature. However, Tether, which has had the parity with that of a dollar lost its value as well when it dropped to 0.60 cents. “Tether continues to process redemptions normally amid some expected market panic following yesterday’s market,” a Tether spokesperson said in an email to Coindesk. “Tether has not and will not refuse redemptions to any of its customers, which has always been its practice”.
Currently, the overall crypto market cap is sitting at $1.19 trillion (approx Rs 91,10,968 crore), as per CoinMarketCap. After March, the value of the crypto market valuation has continued to fall. As of March 31, the market cap of the crypto sector had risen to $2.14 trillion (approx Rs 1,62,77,490 crore). Memecoins such as Dogecoin and Shiba Inu also faced big losses as SHIB has fallen by over 30 percent while DOGE also slipped by over 27 per cent.
In related news to Crypto, the digital currency was recently banned in Nepal. Nepal’s central bank Nepal Rastra had issued the directive to prohibit the sale and purchase of cryptocurrency. In addition, the central bank had mentioned the risk of fraud and an illegal flow of capital into the country as the primary reasons for the restriction.