The prices of Bitcoin and other major cryptocurrencies plunged over the last two days, mirroring the volatility in global stock markets and ending a run of growth and excitement in the crypto industry.
Bitcoin’s price has dropped about 12 percent since Sunday, falling to roughly $53,000. The price of Ether, the second most valuable cryptocurrency, was down nearly 20 percent over the same period.
The precipitous falls show that digital currencies, once envisioned as an alternate asset class that would be shielded from gyrations in the world economy, remain vulnerable to the same broader economic forces that affect technology stocks and risky investments. And the panic is a reminder that Bitcoin and other cryptocurrencies are highly volatile, prone to dramatic increases and decreases in value.
Just a few days ago, the crypto industry was flying high. In January, the approval of a new financial product tied to the price of Bitcoin prompted a market surge that propelled Bitcoin to its highest-ever price. The excitement even led to a wave of new memecoins, the digital currencies tied to internet jokes.
That enthusiasm came to an end on Sunday, as global markets plunged. The panic was caused by several factors, including a slowdown in U.S. job creation and concerns that tech stocks had increased too quickly.
As the price of Bitcoin cratered, investors shared despondent memes on X, while industry leaders tried to reassure crypto fans that the market would rebound.
“Yikes,” Cameron Winklevoss, one of the founders of the crypto exchange Gemini, wrote on X on Sunday. And then a few minutes later: “Everything is fine.”
Source: Elections - nytimes.com
