As selling pressure intensifies in the cryptocurrency market, Bitcoin's sharp decline is once again accelerating.
On December 1 (local time), Bitcoin plunged more than 6% in a single day, marking its worst daily drop since March. As of 4 p.m. in the New York market, Bitcoin was trading at $85,468, down more than 30% from its all-time high of over $126,000 in early October.
The sharp decline has spread to major coins such as Ethereum and Solana, and crypto-related stocks, including Coinbase Global and MicroStrategy, the Bitcoin accumulation company led by Michael Saylor, also fell in tandem.
According to CoinMarketCap, Ethereum dropped nearly 10%, falling to around $2,700 (approximately 3,965,760 won), while Solana declined by more than 8%. According to Bloomberg News, the drop in Bitcoin led to the liquidation of about $1 billion (approximately 1.4688 trillion won) worth of leveraged Bitcoin positions, amplifying the market shock.
Related stocks, such as Coinbase, the largest cryptocurrency exchange operator in the United States, and MicroStrategy, the world's largest corporate holder of Bitcoin, also declined. Recently, stocks with high volatility, including unprofitable tech companies, thematic stocks, and meme stocks, have also shown weakness.
The selling pressure in cryptocurrencies is related to the recent risk-hedging sentiment in the market. Investors continue to sell shares in unprofitable tech companies, speculative shell companies, and meme stocks. Patrick Horsman, Chief Investment Officer (CIO) of BNB Plus, told The Wall Street Journal (WSJ), "Bitcoin could fall to $60,000," adding, "The pain is not over yet."
The WSJ reported, "In past 'crypto winter' phases, major digital assets like Bitcoin only showed signs of recovery after plunging about 80% from their peaks," and noted, "Previous cycles, including the 2022 downturn, were largely triggered by widespread suspicions of fraud and misconduct across the market."
The report continued, "While the cryptocurrency market has repeatedly experienced sharp rises and falls, it is difficult to clearly explain the background of the current decline," and added, "Unlike the 2022 downturn, which was caused by structural negatives such as interest rate hikes and the bankruptcy of crypto exchange FTX, the current situation lacks such clear triggers."
Negative news regarding stablecoins is also weighing on the cryptocurrency market. On November 29, the People's Bank of China, the country's central bank, announced a crackdown, stating that stablecoins are being used for fraud, money laundering, and illegal cross-border capital flows.
On November 26, global credit rating agency S&P also downgraded its stability rating of USDT (Tether), the world's largest stablecoin, to the lowest grade of "vulnerable," warning that a decline in Bitcoin's value could lead to a collateral shortfall.
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