Bitcoin fell below $43,000, testing multi-month lows after minutes from the Federal Reserve’s last meeting showed it leaning toward more aggressive policy action, which sapped investor appetite for riskier assets.
The world’s largest cryptocurrency was last at $42,700, down 1.7%, having lost 5.2% on Wednesday. A break below last month’s trough of $42,000 would make it the weakest since September.
The token hit a record high of $69,000 in November.
The fall “correlated with the ‘risk off’ move across most traditional asset classes,” said Matt Dibb, COO of Singapore-based crypto fund distributor, Stack Funds, pointing to the declines in the Nasdaq in particular.
Moves in cryptocurrency markets are becoming more aligned with those in traditional markets as the number of institutions trading both crypto and other assets grows.
The Nasdaq plunged more than 3% overnight in its biggest one-day percentage drop since February, after Fed minutes showed US policymakers had discussed reducing the bank’s balance sheet at their December meeting, when they also decided to accelerate finishing their bond buying programme..
Share markets in Asia sold off on Thursday as well, while US Treasury yields edged higher.
Ether, the world’s second-largest cryptocurrency which underpins the ethereum network, lost 5.2% on Wednesday, and touched its lowest level since October, before bouncing back slightly to $3,460.
Crypto analysts were also watching to see whether anti-government protests in Kazakhstan, which were initially sparked by rising fuel prices, would affect the bitcoin network.
The central Asian nation was the world’s second-largest centre for bitcoin mining, Britain’s Cambridge Centre for Alternative Finance said last year.
The Kazakh government late last year began cracking down on some miners, fearing the energy-intensive process was using too much power.
The team at Platform Executive hope you have enjoyed the ‘Bitcoin, ether near multi-month lows following hawkish Fed minutes‘ article. Automatic translation from English to a growing list of languages via Google AI Cloud Translation. Initial reporting via our official content partners at Thomson Reuters. Reporting by Alun John. Editing by Sam Holmes.
You can stay on top of all the latest developments across the platform economy, find solutions to your key challenges and gain access to our problem-solving toolkit and proprietary databases by becoming a member of our growing community. For a limited time, our subscription plans start from just $16 per month.