Bitcoin and Ethereum have dropped below $40,000 and $3,000, after dipping below 4% and 5% respectively in the last 24 hours.
Currently priced at $38,962 and $2,904, respectively, the two largest cryptocurrencies by market cap have been in a recent slump.
In the last week, both cryptocurrencies have fallen by almost 8%.
The latest series of price drops can likely be attributed to the mining industry, which has experienced several developments that may have put further pressure on prices.
Bitcoin mining
Last week, Bitcoin miners saw a drop in mining difficulty of over 1%, according to data from Blockchain.com.
Bitcoin mining difficulty, which tracks how difficult it is for a miner to mine Bitcoin, has previously impacted the price of the flagship cryptocurrency.
Back in July 2021 and in the wake of China’s crackdown on the crypto industry, Bitcoin mining difficulty dropped by 28%. At the time, Bitcoin was priced at approximately $34,000 and was soon dipped below $30,000.
According to the Tehran Times, Iran is also set to increase penalties for illegal cryptocurrency mining using subsidized state electricity.
Other market woes
Recent Bitcoin mining headlines are not the only factor in decreasing crypto prices.
The broader crypto market has long been trending in the wrong direction. Last week, the crypto market fell by almost 10%, and the total crypto market cap fell to $1.84 trillion.
Traditional stock markets have also struggled. At the start of last week, the S&P 500 was down almost 2%. The tech-focused Nasdaq lost over 2% of its total value, too.
Previous research has shown the crypto market—especially Bitcoin—to follow traditional equities.
According to Arcane Research, Bitcoin’s price correlated with the S&P last month more so than any time since October 2020.
Disclaimer
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.