The cryptocurrency market was in deep red on Monday morning, extending a sell-off that began late last week and accelerated over the weekend.
Bitcoin, the largest cryptocurrency in the world, fell 7,1% to $ 32.969 at 8:20 am Monday in London. It marked the lowest level for bitcoin in nearly two weeks.
Other major tokens were also in the red, with ethereum down 7,8% to $ 2.028 and XRP down 7,3% to $ 0,69. Dogecoin, the meme token launched into the mainstream earlier this year, fell 8,8% to $ 0,25.
According to data provider CoinMarketCap, the entire cryptocurrency market had lost 6,8% of its value in the past 24 hours on Monday morning.
Where did this sell-off come from?
The sell-off extends a slump that began late last week after the US Federal Reserve hit an unexpectedly hawkish bias in its latest policy meeting. The central bank has anticipated the timing for future interest rate hikes, raising the prospect that cheap money may disappear sooner than expected.
The Fed's change in stance triggered a move away from risk assets and cryptocurrencies got involved in the sale. CoinDesk reported that holdings in bitcoin funds hit a four-month low on Friday in the wake of the Fed meeting.
"Money originates in the Fed and then flows through the markets," said Mati Greenspan, founder and CEO of Quantum Economics. "Now that there is talk of slowing down the pace of new money, or at least signaling that the stimulus is not infinite, investors are starting to wonder what the true value of these assets is."
Headlines on an ongoing Chinese crackdown on cryptocurrency did not help bearish sentiment over the weekend. The Block, a cryptocurrency industry website, reported that regulators in Sichuan province issued a statement ordering the region's cryptocurrency miners to shut down.
"For some reason, traders are focusing on Chinese news and how China continues to take a tougher stance on Bitcoin miners," said Naeem Aslam, chief market analyst at Avatrade.
How to trade cryptocurrencies
Remember that you can always earn on cryptocurrencies, regardless of the market trend. For example, it is possible to trade mainly Bitcoin, with the automatic platform Bitcoin Pro. With this software, everyone can start earning.
Plus, a capital of only $ 250 is required to get started. Those who want, however, can also invest a larger amount to earn more money right away. Of course, our recommendation has always been to only risk the money you can afford to lose, as the digital currency market remains very volatile and always high-risk. Let us know in the comments below what you think.