Bitcoin sank to its lowest level since December 2020

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Bitcoin sank to its lowest level since December 2020

Bitcoin fell more than 10 percent, or below $ 24,000 a piece, and sank to its lowest level since December 2020. The world’s largest cryptocurrency has been hit by macroeconomic problems, including staggering inflation.

Meanwhile, a crypto lending company called Celsius has paused withdrawals for its customers, sparking fears of contagion into the broader market. Over the weekend and into Monday morning, more than $200 billion had been wiped off the entire cryptocurrency market.

The cryptocurrency market capitalization fell below $1 trillion on Monday for the first time since February 2021, according to data from CoinMarketCap. Also, this news upset the crypto world because of this morning's news about the termination of all transactions, and most importantly the payment, the company Celsius, which offers cryptocurrency locking services, on which it gives a certain percentage of interest.

The statement said they had paused all "payments, swaps and transfers between accounts due to extreme market conditions" and that they were doing so to "put Celsius in a better position today to meet its commitment over time", ie to allow users all transactions.

Celsius is one of the largest companies in the field of these services. “Since Nov 2021, sentiment has changed drastically given the Fed rate hikes and inflation management. We’re also potentially looking at a recession given the FED may need to finally tackle the demand side to manage inflation,” Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, told CNBC.

Analysts are not optimistic

“All this points to the market not completely having bottomed and unless the Fed is able to take a breather, we’re probably not going to see bullishness return”. Ayyar noted that in previous bear markets, bitcoin had dropped around 80% from its last record high.

Currently, it is down around 63% from its last all-time high which it hit in November. “We could see much lower bitcoin prices over the next month or two,” Ayyar said.