Over $200 billion wiped off cryptocurrency market in a day as bitcoin plunges below $50,000 cnbc.com
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Bitcoin and other digital currencies plunged on Friday as a proposed capital gains tax hike from U.S. President Joe Biden led to a wave of selling.
Bitcoin was down 7.3% trading at $49,730 as at midday EST, wiping out more than $200 billion of value from the entire cryptocurrency market, according to data from CoinMarketCap.
It’s the first time bitcoin has traded below $50,000 since early March. Ether fell to $2,320, down 8%. XRP, the fifth-biggest cryptocurrency, plunged 16%.
“The market has run up quite a bit overall, and it’s probably cooling off before the next leg up,” Vijay Ayyar, head of business development at cryptocurrency exchange Luno, told CNBC by email. Read the full story
Back in February, some analysts at JP Morgan performed a sobering assessment of Bitcoin along with the market frenzy surrounding the digital currency, but concluded that Bitcoin is an “economic side show” and a poor hedge against a decline in equity prices.
“Crypto assets continue to rank as the poorest hedge for major drawdowns in equities, with questionable diversification benefits at prices so far above production costs, while correlations with cyclical assets are rising as crypto ownership is mainstreamed,” JP Morgan analysts said. Read more about it here
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