Cryptocurrency was down by as much as 20%, hitting its lowest point in months.
Bitcoin and other cryptocurrencies are notoriously volatile and often plunge for mysterious reasons.
Bitcoin and other cryptocurrencies fell sharply Saturday, another sign that investors were pulling back from riskier bets after this week’s stock-market selloff.
Bitcoin, the largest cryptocurrency by market value, was down 18% at $46,571.84 at about 7 a.m. ET, according to data from CoinDesk. It temporarily dipped to $42,000 before bouncing back. Ether, the second-largest cryptocurrency, was down close to 16%.
The declines were widespread across the cryptouniverse. Other widely traded cryptocurrencies including Solana, Dogecoin and Shiba Inu coin lost more than a fifth of their value.
Bitcoin and other cryptocurrencies are notoriously volatile and often plunge for mysterious reasons. Disquiet in the stock market over the new Omicron variant of Covid-19 and the Federal Reserve’s response to inflation might have played a role.
Another possible factor accelerating the bitcoin selloff was the unwinding of heavily leveraged crypto derivatives, said Noelle Acheson, head of market insights at cryptolender Genesis Global Trading. She pointed to a large sell order that might have triggered margin calls and liquidations for investors.
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