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Bitcoin falls below $19,000 as cryptos creak under rate hike risk

Skylar Shaw

Sep 20, 2022 14:27


On Monday, cryptocurrency prices hit new lows as a result of regulatory worries and a general investor reluctance to engage in risky assets due to impending interest rate increases.

By market value, Bitcoin, the most valuable cryptocurrency, dropped almost 5% to a three-month low of $18,387.

The second-largest cryptocurrency, ethereum, lost 3% to a two-month low of $1,285 and had lost more than 10% in the previous day. The majority of the smaller tokens had larger losses.

Over the weekend, a significant update to the Ethereum blockchain—which supports the ether token—called the Merge changed how transactions are handled and reduced energy consumption.

The value of the token has decreased amid rumors that comments made last week by Gary Gensler, chairman of the U.S. Securities and Exchange Commission, suggested the new structure would draw further regulation. The upgrades' surrounding trades were likewise unwound.

The regulatory outlook is guesswork, according to Matthew Dibb, COO of Singapore's Stack Funds cryptocurrency platform.

Since the Merge, the markets have shed a lot of their excitement, he said. Given the uneasy global background, he said, "It's truly been a sell-the-news sort of event," and predicted that ether will test $950 in the near future.

"From a basic and technological standpoint, the current situation does not appear promising. There isn't a clear quick positive trigger that will support these markets and inject a ton of fresh cash and liquidity, in our opinion.