Panic As #Bitcoin Sinks Below $40K Amid Possible Global Recession—-Despite ongoing concerns about inflation and a possible global recession, the flagship crypto continued its drop on Tuesday.
Recently, bitcoin has fallen under $40K mark, a drop of 5.4% for the day after touching a high above $47K at the end of March
Ethereum, the second-largest crypto by market value, is trading roughly over $3K, a decline of more than 6% since the middle of last month, after dropping below this threshold earlier in the day.
Optics
- The decline in bitcoin’s 50-day moving average, below $42K, has investors wary. In the event of a fix below this level, a direct path to the area of the March lows near $38K is likely.
- Altcoins such as Terra’s LUNA token, SOL, and ADA also suffered losses by double digits. Also beaten down significantly were meme coins Dogecoin and Shiba Inu. There was little trading.
- Hayes, the former CEO of BitMEX, believes the equity markets could meltdown if interest rates rise and the Fed stops its asset purchases. Hayes predicts that the crypto markets will continue to decline and that Bitcoin will drop to $30K and Ether to $2.5K by June.
- The NY Fed released a study on Monday revealing that US consumers expect inflation to pick up in the near future. Prices for food and housing are expected to rise dramatically in the next 12 months, raising inflation expectations from 6.0% to 6.6%. Expectations for 3 years down from 4.2%.
- According to consumers, rent is expected to rise 10.2% in the year ahead, while food costs will jump 9.6%.
- A 6% increase in home prices is expected, up from 5.7% previously. Survey participants predict that inflationary pressures will worsen before they improve, which will worry Federal Reserve officials.
The Russian invasion of neighbouring Ukraine disrupted supply chains and increased energy costs, which was already increasing anxiety among crypto investors.
In an attempt to link Donbas with Crimea on the Black Sea, Russian forces continued to mass in the eastern region of Donbas on Monday.
Société Générale, France’s third-largest bank, became the latest major corporation to stop doing business with Russia as European Union allies and others opposed to Russia’s aggression considered additional economic sanctions.
