On Thursday, Bitcoin recorded a new low for the year as it reached $19,000 amid the collapse of Three Arrows, a cryptocurrency hedge fund, and the high risk of an economic recession.
For the uninitiated, Three Arrows Capital, a leading crypto fund, made a heavy investment in Luna before its dramatic collapse; after facing legal challenges from creditors regarding unpaid debts, it has gone into liquidation proceedings.
So far this year, the value of Bitcoin has declined 60% this year and is over 70% away from it’s all-time high of $69,000 in November. A Chainalysis report highlighted the decline in the tech market as one of the significant reasons for Bitcoin’s price drop. At the time of writing, Bitcoin is trading at $19,454.97, up 0.37% in the last 24 hours. Other leading cryptocurrencies have also experienced a decline in their value, with the top altcoin, Ethereum, trading at $1,066.49 and Solana at $32.91.
In recent months, cryptocurrencies have been heavily correlated with stocks. On Thursday, major indices were recorded to be at a low in premarket trading. Dow Jones Industrial Average futures pointed towards a loss of over 300 points.
Below is the commentary on the bitcoin price from Bitfinex Market Analysts:
“Edgy cryptocurrency markets are in the red zone after the release of more data signaling an economic slowdown in the US. Bitcoin stands at the US$19,000 mark as the combination of inflation, rising interest rates, and recession casts a dark shadow across financial markets. While bitcoin continues to correlate with out-of-favor growth technology stocks, in the digital token ecosystem, it is once again taking its place as a safe haven despite today’s fall. Unrelenting selling pressure today has resulted in a significant drop in the price of Ethereum, Solana, and Avalanche.”
Established in 2012, Bitfinex is among the oldest and most prominent cryptocurrency exchanges in the crypto industry. Bitfinex caters to investors globally by offering them crypto trading services. Bitfinex grants access to peer-to-peer financing, financed trading for several crypto assets, and the OTC market. Bitfinex traders and Market analysts possess years of valuable experience in the crypto field.
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