•Bitcoin price dropped below $20,000 after its biggest dump since November 2022.
•The selloff was largely fueled by negative news such as the New York Attorney General suing KuCoin and reports of a new US tax on Bitcoin mining.
•Price also dropped due to news of crypto bank Silvergate winding down and security breach on Hedera.
Bitcoin Drops Below $20K
Bitcoin price fell below $20,000 after its biggest dump since November 2022 amid broader selloff for cryptocurrencies. The top crypto asset by market cap dumped, largely fueled by negative news such as the New York Attorney General’s lawsuit against KuCoin and reports of a new US tax on Bitcoin mining.
What Caused Crypto Bloodbath
The market’s reaction saw Ethereum price plunge to lows of $1,375 as one of the securities identified in the lawsuit and overall selloff pressure also follows news that crypto bank Silvergate was winding down. Huobi Token’s flash crash and a security breach on Hedera added to the broader market bloodbath and caused panic among traders which led to further losses for Bitcoin.
Largest Dump Since November 2022
As the Bitcoin price chart shows, the value of the leading cryptocurrency by market fell to lows of $19,569 on cryptocurrency exchange Bitstamp after it saw its biggest price dump since November 2022 during the FTX dump. This after a selloff that began late Thursday extended into Friday morning, with the dump pushing BTC below the psychological support zone of $20,000 for the first time since early January.
Effects On Market Cap
The negative news triggered fears among traders resulting in stocks and cryptocurrencies shedding over $2 trillion in market cap over two days according to analyst Miles Deutscher who highlighted this confluence of triggers causing panic among investors.
Overall it appears that Bitcoin has suffered from multiple negative headlines which have all converged to cause an overall decrease in prices across both stocks and cryptocurrencies within two days. While there is no indication as yet how long this selloff will last or how far prices could fall, it is clear that investors are feeling cautious at present given these latest events.