The cryptocurrency market has been in freefall in recent weeks. Per CoinGecko, Bitcoin and Ethereum are down 9.6% and 14.2% in the last seven days.
Other prominent cryptocurrencies—like Solana and Dogecoin—are also firmly in the red, plunging 19.7% and 12.3% during the last week, respectively.
Alongside leading cryptocurrencies, companies that have made big bets on crypto are also struggling.
Microstrategy—which has over $5 billion in Bitcoin—and is led by Bitcoin bull Michael Saylor—fell by nearly 3% by closing price yesterday.
Similarly, payments firm Block—led by Jack Dorsey and formerly named Square—was down by 0.44% by closing time yesterday. The company has recently announced its intention to enter the Bitcoin mining fray.
PayPal, which made headlines in November 2020 when it announced all U.S. account holders could buy and sell cryptocurrencies through its platform, is also in the red, albeit by 0.16% by market close yesterday.
Crypto exchange Coinbase is, however, bucking this trend, after closing trading yesterday up almost 1%.
Tesla, the electric vehicle manufacturer that holds Bitcoin on its balance sheet, is also up 0.62% today. The company also recently began accepting Dogecoin payments for merchandise like Tesla-branded apparel.
Traditional markets take a dive
A similar bearish trend exists in the world’s traditional markets.
The Nasdaq 100—a stock market index made up of the largest non-financial companies listed on the Nasdaq—was down by 1.3% at yesterday’s close.
Two months ago, the Nasdaq 100 hit an all-time high but has since dropped by over 10%—a downturn that broadly coincided with early reports of the Omicron COVID-19 variant.
The S&P 500—which tracks the performances of 500 large companies listed on American stock exchanges—has also fallen by over 1%.
What does this mean for crypto?
The most recent crypto market downturn offers more evidence that the cryptocurrency market is not immune to non-crypto market movements.
When the Omicron variant spooked markets in November, Bitcoin and Ethereum fell from $58,700 and $4,400 to $54,595 and $4,109, respectively.
Earlier this year, unrest in Kazakhstan and speculation about increasing interest rates from the Federal Reserve both caused crypto prices to plunge yet again. Between January 1, 2022, and January 10, 2022, Bitcoin fell by 14%.
In contrast, Ethereum fell under $3,000, a low that had not been seen since September 2021.
Disclaimer
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.
