© Reuters
By Laura Sanchez
Investing.com – The cryptocurrency sector continues to slide. The world’s largest crypto, the , was targeting low support between $27,000 and $30,000 yesterday. “Sellers may remain active given the loss of bullish momentum on the daily, weekly and monthly charts,” according to Coindesk.
The crypto has lost almost 55% of its value since the November highs and was yesterday at its lowest level in 10 months.
Many pundits continue to allude to bitcoin’s increasingly close correlation with the , which challenges the argument that the cryptocurrency functions as a hedge against inflation.
“The market players that have entered in recent years are essentially traditional funds. They trade bitcoin the same way they trade tech stocks, even though many aspects of bitcoin are inherently considered risky by native people. cryptocurrencies,” Blockware Solutions analyst Will Clemente told MarketWatch.
So the pattern that crypto and the stock market are increasingly intertwined continues to hold true. Investors sold risky assets in the face of high inflation, tighter central bank monetary policy and increased geopolitical risk with the Russia-Ukraine war.
Currently, the market views bitcoin and Nasdaq as “long duration, interest rate sensitive risk assets,” Spectra Markets notes.
Interestingly, Glassnode analysts also noted an influx of “urgent trades” amid this latest selloff, with investors paying higher fees, indicating they were willing to pay a premium to speed up times. of transactions. The total value of all transaction fees paid on the chain reached 3.07 bitcoins over the past week, the highest figure ever recorded in its data set, CNBC reports.
“The prevalence of blockchain transaction fees associated with exchange deposits also signaled urgency,” Glassnode’s report notes, further supporting the argument that bitcoin investors were looking to reduce risk, sell or add collateral to their margin positions in response to market volatility.