Crypto Stocks Slump as Bitcoin, Ether Tumble
Bitcoin and ether experienced a sharp decline on Monday due to increased caution and uncertainty in the global markets.
Shares of companies in the crypto industry experienced similar drops, with several mining companies decreasing by over 10% before the market opened. Additionally, the popular crypto exchange Coinbase saw a 9% decline in its share price.
Stock prices for companies in the cryptocurrency industry dropped on Monday due to increasing conflicts in the Middle East and worries about the overall strength of the world economy. This led to significant decreases in the value of bitcoin (BTC) and ether (ETH), reaching their lowest points in several months.
Cryptocurrency platform Coinbase (COIN) saw a decrease of over 9% in early U.S. trading before the stock market opened. MicroStrategy, a company focused on software development that has been buying bitcoin and now owns more than 1% of the total amount of bitcoin that will ever be created, experienced a 13% drop in their stock value. CoinShares, a firm that manages crypto assets, also saw a decline of 7.5% in Sweden.
Cryptocurrencies took a nosedive after information from the U.S. showed that the biggest economy in the world might not be as strong as previously believed. The Labor Department released job numbers on Friday that were lower than anticipated, along with a higher unemployment rate than expected. Tensions in the Middle East escalated as Iran made threats to attack Israel in retaliation for the killing of Hamas' political leader, Ismail Haniyeh, in Tehran last week. Haniyeh had been labeled a terrorist by the U.S. in 2018.
Bitcoin, the most valuable digital currency based on market value, decreased by up to 15% on Monday, falling below $50,000 for the first time since February before bouncing back to trade at around $52,000. Ether, the second-largest cryptocurrency, experienced a seventh consecutive day of decline, marking its largest drop since May 2021. The CoinDesk 20 Index (CD20), which tracks the overall cryptocurrency market, declined by nearly 20% and was down by 16% as of 09:00 UTC. Stock markets in Asia and Europe also saw declines.
Miners slumped in tandem with the decline of bitcoin. Marathon Digital (MARA) and Iren (IREN) both saw their value drop by nearly 14%, Hut 8 (HUT) tumbled 12%, and Riot Platforms (RIOT) fell by 11%.
Written by Oliver Knight.
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