Bitcoin falls after crypto lender holds withdrawals
Bitcoin, which surged in 2020 and 2021, is down around 50% so far this year. PHOTO: FILE
Bitcoin slumped 14% on Monday after major US cryptocurrency lending company Celsius Network froze withdrawals and transfers citing “extreme” conditions, in the latest sign of the financial market downturn hitting the crypto sphere.
The Celsius move triggered a slide across cryptocurrencies, with their value dropping below $1 trillion on Monday for the first time since January 2021, dragged down by bitcoin, the largest token.
New Jersey-based Celsius, which has around $11.8 billion in assets, offers interest-bearing products to customers who deposit cryptocurrencies with its platform. It then lends out cryptocurrencies to earn a return. After Celsius’s announcement, bitcoin touched an 18-month low of $22,725, before rebounding slightly to around $23,924. Number two token ether dropped as much as 18% to $1,176, its lowest since January 2021.
“It’s still an uncomfortable moment, and there’s some contagion risk around crypto more broadly,” said fund management firm Solrise Finance Head of Financial Strategy Joseph Edwards.
Crypto markets have dived in the past few weeks as rising interest rates and surging inflation prompted investors to ditch riskier assets across financial markets.
Published in The Express Tribune, June 14th, 2022.
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