Bitcoin continues in free fall: it loses 28% in one week

Bitcoin deepens its losses and after the collapse of the previous day, this Tuesday loses 7%, with which in a week accumulates a loss of its value of 28%. In the early hours, the cryptocurrency is trading at US $ 22,127.5.

However, in the morning it even lost 10.25%, and reached a low of $ 20,800.

The cryptocurrency today adds its eighth consecutive session to the downside, although the biggest losses were recorded on Monday, when he lost up to 18% (although it eventually shrank by 16%).

The collapse of the cryptocurrency market has caused Argentine investors a lot of nervousness. There were two main reasons for this: on the one hand, the most popular cryptocurrency dropped 16% in one day and nearly 28% in the last week to drop below US $ 23,000, the lowest level in 18 months. On the other, two well-known platforms, Celsius Network and Binance have limited withdrawals due to technical issues.

The current scenario is one of total uncertainty and bewilderment. The price of bitcoin accumulates a decline of 46% over the yearand 65% from the record highs reached last November, when it hit $ 69,000.

The brutal collapse of bitcoin accompanies the fall of the financial markets for fear of an inflationary outbreak in the world. Since the US inflation data was released last Friday, the world’s best-known crypto asset has been in steep decline.

In this sense, IG analyst Sergio Ávila assured that inflation in the United States, which rose to 8.6% in May, higher than expected, “causes the market to discount more aggressive interest rate hikes by central banks and puts pressure on the US Federal Reserve (Fed) to further raise rates “.

“Interest rate hikes negatively affect technology, all sectors that have to do with growth and, of course, cryptocurrencies, which are equally affected,” Ávila stressed.

Since the last rate hike announced by the Fed on May 4, bitcoin has lost 40% of its value.

We will have to see what the Federal Reserve solves these days when it concludes with its monthly meeting.

Binance and Celsius amplified the drop in bitcoin

The cryptocurrency shakeout was amplified by withdrawal restrictions from Binance and Celsius Network. The latter is one of the largest cryptocurrency lending platforms in the world and operatesto approximately US $ 12.00 million in assets of its clients, according to the Financial Times. This Sunday he announced that he would be suspending all withdrawals and transfers between accounts due to “Under extreme market conditions”the company said on its official blog.

Binance is global and operates in Argentina. The company reported it limited bitcoin withdrawals due to technical issues. “A previous batch of transactions stalled due to the low transaction fees sent and thus resulted in a backlog of withdrawals across the network,” they explained on Twitter.

The data has once again reopened the debate on the nature of bitcoin and cryptocurrencies. More than 100 countries are already studying new regulations on an operation that escapes the controls of monetary and fiscal authorities.

Last month, the Central Bank blocked two local authorities (Galicia and Brubank) from offering cryptocurrencies to their customers.

YN