Despite a slight increase after yesterday Federal Reserve rate hike by 75 points, cryptocurrencies are again feeling pressure from a myriad of factors, including destabilized markets, fears of an impending recession, TerraUSD’s previous depeg and slow celsius crush.
As of this writing, Bitcoin price sits at $20,891, a whopping 7.41% drop in the last 24 hours. Ethereum also fell around 11.35% and now sits at $1,096, a record drop from a low. Price set at $4,426 in November 2021 of Ethereum’s all-time high. Ethereum Classic isn’t faring well either, down 4.9% for the day at a price of $15.40 and is down 71.92% year-on-year.
Smaller, lesser-known cryptos are also feeling the chill of the crypto winter, best expressed via Polygon, which is currently trading at a low of 0.39 cents, down 73.87% for the year. Solana ($30.84), Dogecoin ($0.05) and Avalanche ($16.17) are all in the red, recording price drops of 2.3%, 4.79% and 5.04% respectively .
These continued pressures swirling around crypto news lately are largely due to the heightened panic associated with the Fed’s interest rate hike yesterday, affecting not only securities and digital assets, but everything from mortgages. to air fares. Beyond that, Bitcoin and Ethereum both determine the values of several cryptocurrencies in the market, which means that many other assorted risky assets are tied to the highest prices, making any decline an event on the downside. market scale.
Related article: Crypto Lender Celsius Halts Withdrawals and Transfers Amid Market Crash
Additionally, recent events surrounding cryptocurrency lending platform Celsius have caused major fears within the market, heightened by the previous disaster known as TerraUSD. Acting as a sort of digital asset bank, which was posting impeccable gains of around 18.6% per year, Celsius had no sooner started to lose ground in the current climate of fear.
In October 2021, Celsius Network CEO Alex Mashinsky pointed out that the lending platform’s total assets amounted to $25 billion, more than enough capital to meet both lenders and borrowers for all their DeFi needs. Last month, according to the Celsius website, his assets totaled $11.82 billion. Riddled with poor crypto investments and massive withdrawals, Celsius was hit with a rather bleak future, forcing the firm to halt all withdrawals and transfers on Monday, June 13, citing the need to “stabilize liquidity.” This very decision is now reviewed by various securities regulators from New Jersey to Texas.
TerraUSD, the algorithmic stablecoin attached to its sister coin Luna, set the crypto markets on fire several months ago, costing the industry a recorded loss of $400 billion. Fears still reign supreme after the demise of stablecoins, yet a new entity has risen from the ashes of TerraUSD, called Luna 2.0, which has experienced its own chess mess since launch.
According to a cryptocurrency research firm Kaiko, Celsius has few options to get out of the gutter. Conor Ryder, the crypto analyst under Kaiko, relayed these sentiments to the company Official report published on Wednesday, June 15.
“Even if they survive this onslaught, I don’t see how anyone can trust Celsius to protect their assets in the future. Perhaps in a few years we will see this as a watershed moment for the adoption of decentralized finance, but that’s probably just the optimist in me.”
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