Crypto Altcoins Lead Declines; Bitcoin Price Drops Back Below $19,000
Prices in the cryptoasset market slumped across the board on Thursday, with so-called altcoins being hit particularly hard as risk aversion continues to weigh on global financial markets.
Bitcoin, the largest cryptocurrency by market value, fell as much as 3% on Thursday in New York to $18,585, its lowest point since Sept. 27. Ether fell more than 4%, with both coins trending toward the lower end of their respective ranges.
“From what we can tell, Bitcoin has been trading across a trendline between the 2018 and 2022 low for the last month. It's just dipped below it, but has generally recovered fairly quickly,” said Fadi Aboualfa, head of research at crypto custodian Copper. “Based on some of our own projections, we see Bitcoin trading closer to $21k by the end of the month should macro-events not weigh-in negatively.”
Elsewhere, US futures were trading positively and options activity showed a rise in hedging ahead of a US September inflation report. Minutes from the Federal Reserve's September meeting on Wednesday showed officials were committed to raising interest rates to curb inflation, a touchstone for crypto activity where Bitcoin has moved largely in tandem with risk assets.
“At a time when we're heading from interest rate and inflation anxiety, into a probable recession, it's possible that while reducing risk exposure, investors will be more willing to hold traditional risk assets that cryptos which were becoming increasingly popular as an alternative in the zero interest rate environment,” said Craig Erlam, senior market analyst at Oanda Europe Ltd.
Meanwhile altcoins including Solana, Avalanche, Polygon and Cardano all tumbled more than 6% in the last 24 hours. As interest rates have risen this year,
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