The largest cryptocurrency dropped as much as 7.4 per cent to $38,261, while second-ranked ether slid below $3,000. Digital tokens overall have shed some $1 trillion in value since a November peak, according to CoinMarketCap data.
“Bitcoin and the broader crypto market remain subject to the whims of macro variables,” Fundstrat Digital Asset Research strategists Sean Farrell and Will McEvoy wrote in a note.
Virtual coins have become emblematic of a retreat in speculative investments sparked by the prospect of tighter monetary policy in the US. Bitcoin of late has tracked swings in technology stocks, which have been under pressure, with the Nasdaq 100 tumbling into a correction on Thursday.
A technical pattern based on a momentum indicator known as the weekly relative strength index hinted at the possibility that bitcoin’s slump might be due a breather. The indicator on Friday fell into a region that in the past accompanied floors in bitcoin selloffs.
Bitcoin has soared in the past several years, partially on controversial narratives around institutional adoption and its possible role as a portfolio hedge. Its gyrations during a volatile time for global markets have undercut some of those claims.
Bitcoin is up more than fourfold in the past two years but has shed about $30,000 since reaching a record high in November of almost $69,000. – Bloomberg