Bitcoin Tumbles Below $50,000 as Fear Sweeps Through Crypto
(Bloomberg) – Bitcoin’s losses accelerated, with prices tumbling below $50,000, as investors started to bail on the market’s frothiest assets.
The cryptocurrency tanked as much 18% on Tuesday and traded around $48,750 as of 10:41 a.m. in New York. While the selloff only puts Bitcoin prices at the lowest in about two weeks, investors are starting to wonder whether it marks the start of a bigger retreat from crypto or simply represents volatility in an unpredictable market.
“Today’s correction for crypto assets is part of a wider sell-off in markets globally, being driven by profit-taking,” said Simon Peters, a crypto-asset analyst at the trading platform eToro. “Investors are closing positions, which will have generated significant gains for many of them.”
Bitcoin has been battered by negative comments this week, with long-time skeptic and now Treasury Secretary Janet Yellen saying at a New York Times conference on Monday that the token is an “extremely inefficient way of conducting transactions.”
Microsoft Corp. co-founder Bill Gates also weighed in. In an interview with Bloomberg Television’s Emily Chang, the billionaire said he’s not a fan of Bitcoin and warned against retail investors being swept up in speculative manias.
“It’s a pure speculative asset,” said Nader Naeimi, head of dynamic markets at AMP Capital Investors in Sydney.
Other markets that have seen massive gains this year sold off sharply on Tuesday. Tesla Inc. sank as much as 13%, Cathie Wood’s flagship $28 billion ARK Innovation ETF dropped as much as 12% at one point. The Bloomberg Galaxy Crypto Index, which spans Bitcoin, Ether and three other digital tokens, declined as much as 21%.
Bitcoin did rise from the lowest levels of the day after crypto exchange Bitfinex settled a probe with New York Attorney General Letitia James over allegations that it hid the loss of commingled client and corporate funds and lied about reserves. Some market participants saying that the agreement, which included $18.5 million in penalties, lifts a cloud over the cryptocurrency market.
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“On the grand scale of things, it’s less than a speeding ticket,” said Antoni Trenchev, managing partner and co-founder of Nexo in London, a crypto lenders. “I’m just excited that they will be revealing more numbers so that we can accurately assess and hopefully that will create some comfort for the market participants.”
Bitcoin prices have soared more than 50% this year as more investors buy in to the argument that digital currencies can act as a hedge against inflation. A pullback in Bitcoin shouldn’t be surprising “given the current over-leveraged long positions on mainstream coins,” said Annabelle Huang, a partner at Amber Group, a crypto financial-services firm.
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Crypto selloff sends Bitcoin tumbling below $50,000 - CityAM
Bitcoin tumbled this morning as investors ditched cryptocurrencies amid nervousness over sky-high valuations.
Bitcoin suffered its biggest daily drop in a month to fall as low as $45,000 before recovering to just over $48,500. Ethereum is also down more than 18 per cent to $1,512.
It follows Monday’s crash which saw Bitcoin plunge from $58,000 to $47,400. At one point the cryptocurrency fell $5,000 in 10 minutes before paring back its losses somewhat.
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It comes just days after the world’s biggest cryptocurrency hit a new record of $58,354 on Sunday.
Analysts pointed to Elon Musk, who commented the price was too high, for the sharp fall in bitcoin over the past day.
Musk’s electric vehicle firm Tesla recently invested $1.5bn in bitcoin but as a result of his tweets is set to open lower later today.
“There is little doubt that it’s less than ideal for a ‘safe haven’ asset to follow one man’s words to the letter. Bitcoin remains highly volatile, and unpredictable – unless you can predict Elon Musk thoughts in advance,” Ipek Ozkardeskaya, senior analyst at Swissquote said.
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“Speculators are clearly hanging on [Musk’s] every word… This kind of euphoria should probably make people nervous but I doubt it will. I’m sure new highs are just around the corner,” Craig Erlam, senior market analyst at Oanda.
Despite the widespread support, Treasury secretary Janet Yellen warned that “Bitcoin is an extremely inefficient way of conducting transactions and the amount of energy that’s consumed in processing those transactions is staggering”.
Bitcoin Tumbles Below $50,000 as Fear Sweeps Through Crypto
The Canadian Press
WASHINGTON — The White House did not acknowledge Canada’s own wish list for President Joe Biden’s meeting with Prime Minister Justin Trudeau, focusing instead Tuesday on areas of “shared vision” and “mutual concern.” The U.S. administration’s “road map” for enhanced co-operation between the two countries lays out priorities for Biden’s first bilateral meeting as president — a route that steers well clear of potential potholes. “The road map is a blueprint for our whole-of-government relationship, based on our shared values and commitment to work in partnership on areas of mutual concern,” the White House said. It lays out six priority areas, including battling the pandemic, rebuilding the economy “on both sides of the border,” and a “high-level climate ministerial” meeting to align efforts to reach net-zero emissions by 2050. It also mentions social diversity and inclusion, expanded co-operation on continental defence and a modernized NORAD, and restoring a collective commitment to global institutions like NATO and the World Trade Organization. The section on “Building Back Better” — a turn of phrase from Biden’s presidential campaign that’s also popular with the Trudeau government — pays tribute to Liberal election rhetoric as well, promising a vision “that strengthens the middle class and creates more opportunities for hard-working people to join it.” A number of Canada’s explicit priorities, including access to COVID-19 vaccines, freeing Michael Spavor and Michael Kovrig from China or securing an exemption to Buy American, are conspicuously absent. So too is any mention of Keystone XL, the on-again, off-again cross-border pipeline expansion Biden cancelled with the stroke of his presidential pen on his first day in office. Experts want Ottawa to push the U.S. hard to exempt Canada from Buy American, Biden’s suite of protectionist measures to ensure infrastructure spending prioritizes American businesses. No immediate changes to that regime are on the horizon, White House press secretary Jen Psaki said Monday. “He signed an executive order; we’re of course evaluating procurement components of that, but no changes anticipated.” Trudeau is nonetheless expected to ask for fewer restrictions on U.S. vaccine exports, since Canada has been squeezed by production problems in Europe, and for more help in bringing Spavor and Kovrig home. They were detained in an apparent act of retaliation after Canada arrested Huawei executive Meng Wanzhou in December 2018 on U.S. charges of violating sanctions on Iran. On the two Michaels, Psaki would only say, “The prime minister will bring up whatever he would like to bring up, as is true of any bilateral meeting.” The White House also says the two plan to resurrect the North American Leaders' Summit — a trilateral meeting of Canada, the U.S. and Mexico, more commonly known as the “Three Amigos” summit, which hasn’t been convened since 2016. Eric Miller, a Canada-U. S. expert and president of the D.C.-based Rideau Potomac Strategy Group, said the synchronicity between the two leaders is why Trudeau needs to seize the moment. “To me, this is exactly the moment for Canada to go on offence,” Miller said. The Biden administration and the Trudeau government have aligned interests on climate change, a multilateral foreign policy and on a new approach to China, he said. And Biden, an outspoken champion of unions, needs to be careful not to run afoul of organized labour groups with large memberships on opposite sides of the border. “If I were Canada, I’d be pitching very strongly for a Buy American agreement — I mean, the worst they can say is no,” Miller said. Blue-collar workers in Canada “are pretty much exactly the same as their U.S. counterparts. Why are you going to hit them with restrictions when it’s like hitting your cousin?” Maryscott Greenwood, the chief executive officer of the Canadian American Business Council, said the Prime Minister’s Office would do well to imagine Donald Trump is still in the White House. “Canada embarked on a very, very forward-leaning, activist agenda about engaging the U.S., inside and outside of D.C.” when Trump was in office, she said. “It’s going to be important to have that level of urgency and that level of effort, and not just assume that everything’s good now that Biden’s here.” That was made clear when Keystone XL was promptly cancelled last month, said Bill Reilly, who led the Environmental Protection Agency from 1989 to 1993 under former president George Bush. Canada is “very likely to be raising issues that run counter to some of the environmental aspirations that animate the Biden administration,” Reilly told a panel discussion Monday hosted by the American Council for Capital Formation. “I don’t think some of these issues are going to lend themselves to easy resolution.” This report by The Canadian Press was first published Feb. 23, 2021. James McCarten, The Canadian Press