08/09/2022
The Cryptocurrency market on Wednesday saw a massive fall in prices of popular cryptocurrencies including Bitcoin, Ethereum, BNB among others putting investors in a frenzy.
Bitcoin crashed to $30,066, the lowest since late January, wiping out more than $500 billion in value from the coin’s peak market value. This marked its largest one-day loss since March 2020.
Ethereum fell to as low as $1,850, its weakest level since late January. BNB was down almost 31% at $353.12. Almost all other coins are red and dropping as well. As per CoinGecko, the value of more than 7,000 tokens has shrunk more than $600 billion in the past week to $1.9 trillion.
This massive retreat in the crypto boom has come as a test of its durability but on the other hand, is not a surprise given its volatile nature.
Multiple factors are at play, ranging from criticism of the environmental impact of Bitcoin’s energy usage by onetime proponent Elon Musk to Chinese regulators announcing a crackdown on cryptocurrencies.
What is behind the Cryptocurrency Market Meltdown?
China has barred financial institutions and payment companies from providing any services related to cryptocurrency transactions. This means that banks and online payment channels must not offer clients any service involving cryptocurrencies, such as registration, trading, clearing, and settlement.
But while China’s announcement came as the last straw, the decline in values of the two most traded cryptocurrencies BTC and ETH came last week itself after Tesla CEO Elon Musk announced that the electric carmaker won’t be accepting Bitcoin as payment — a reversal of an earlier decision that had sent it soaring to its $64,870 peak.
The meltdown in the market has left investors scrambling to exit which has also caused India’s largest Cryptocurrency exchange – WazirX’s services to crash. Apart from WazirX, other global exchanges such as Binance and Coinbase have reported similar technical troubles leaving investors fuming.