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stock market slump

Bitcoin hits its lowest point since Jan

On Monday, Bitcoin slumped to its lowest level since January as the equity markets continue hurting cryptocurrencies, which are currently trading along with the tech stocks, so-called riskier assets.

In the morning trade, Bitcoin fell as low as $33,266 to test the January low of $32,951. Had it fallen below this level, the fall would have been the lowest since July last year.

It managed to recover around $33,500, down by 1.4%.

As per one of the experts, crypto is still classed as a riskier asset that is similar to those listed on Nasdaq. Most cryptocurrencies are declining.

Last week the tech-heavy Nasdaq fell by 1.5%, losing 22% year to date, hurt by the continuous inflation forcing the United States Federal Reserve to hike rates even with a slow growth rate. In the Asian trade on Monday, Nasdaq fell 0.8% further.

Other factors in bitcoin’s weekend slide were the crypto market’s notoriously low liquidity on weekends and short-lived fears that an algorithmic stablecoin dubbed Terra USD (UST) could lose its peg to the dollar, as the experts pointed out.

Stablecoins are digital coins pegged to other traditional assets, mostly the U.S. dollar.

The crypto community is closely watching the Terra USD (UST) as it proposes an unusual way of maintaining a 1:1 dollar peg. Furthermore, its founder plans to build a $10 billion reserve of Bitcoin backed by stablecoin. Thus, the chances of USTs potential spill over into Bitcoin cannot be ruled out.

On Monday, Ethereum, the world’s second largest cryptocurrency, dropped to $2,421, registering its lowest since late February.