The value of Bitcoin has fallen below $19,000 (£14,000),
6/18/2022, 07:05 PM
CM=Crypto investors are grappling with aggressive interest rate hikes from the U.S. Federal Reserve and a worsening liquidity crunch. Bloomberg | Bloomberg | Getty ImagesBitcoin dropped below $19,000 on Saturday, extending a brutal slide in cryptocurrencies. The price of bitcoin fell more than 9% in 24 hours to $18,642.22, as of about 2 p.m. ET, according to Coin Metrics data. The last time bitcoin traded around this level was December 2020. Ether, the second-largest token, plunged 10.54% to $963.22Crypto investors are grappling with aggressive interest rate hikes from the U.S Fed and a worsening liquidity crunch that has pushed major players into financial difficultyThe Fed on Wednesday hiked rates by 75 basis points; its biggest increase since 1994 which has led to a retreat from risky assets including stocks and cryptoElsewhere in the crypto space is still reeling from the fallout of the $60 billion collapse of two major tokens last monthTerra; a so-called stablecoin that was meant to be worth $1 crashed to a fraction of a cent taking an associated coin called luna down with itThis week; $3 billion crypto lender Celsius halted withdrawals locking users out of their funds and raising fears it may face insolvencyCelsius acts like a bank; taking investors' crypto and lending it out to institutions to generate return on depositsIt holds lots another key player Three Arrows Capital is in midst if its own liquidity crisisThe $10 billion crypto hedge fund is reportedly on brink if insolvency after plunge in crypto markets reduces value if its holdings 3AC was an investor in Terra and has made leveraged bets on numerous tokens including bitcoin ether and solanaZu Shu; firm's co-founder said it was "in process if communicating with relevant parties and fully committed to working this out"On Friday he told The Wall Street Journal that 3AC was considering asset sales and rescue by another firm to avoid collapseRyan Shea; an economist at crypto investment firm Trakxio said recent stress in digital assets was "crypto market equivalent if natural selection""Absent central bank ; onus is on firms operating space be responsible and those that aren't (ie excessive leverage poor risk management poor security etc) will not succeed"Shea said research note Friday"This process is without doubt painful but ultimately lack centralized backstop good thing means moral hazard avoided because no bailouts in cryptofiat system"-CNBC's Jessica Bursztynsky contributed this report I think what you're saying is that there are some serious problems going on right now with some large cryptocurrency companies which could have far reaching implications throughout the industry as well as for those who have invested money into these companies or hold their currency.