[Bitcoin Now] '10% Sharp Drop' Falls to $18,000 Level... 'Extreme Fear'

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] The price of Bitcoin, the leading cryptocurrency, plummeted by more than 10%, falling to the $18,000 range.

According to the global cryptocurrency market tracking site CoinMarketCap, as of 2:33 PM on the 19th, Bitcoin's price was $18,307 (approximately 23.71 million KRW), down 10.52% from the previous day. This is the first time Bitcoin's price has dropped to the $18,000 range since December 2020.

Bitcoin's price has been declining amid recession concerns following the U.S. Federal Reserve's (Fed) giant step (a 0.75 percentage point interest rate hike). U.S. economic media CNBC reported, "Cryptocurrency investors are grappling with the Fed's aggressive interest rate hikes and a liquidity crisis that has pushed major companies into financial difficulties."

Additionally, the cryptocurrency hedge fund Three Arrows Capital facing bankruptcy due to the Luna Classic incident is another negative factor. Three Arrows Capital manages about $3 billion (approximately 3.885 trillion KRW) in cryptocurrencies and is known to have invested more than $200 million in Luna Classic as of February. Kyle Davies, co-founder of Three Arrows Capital, stated, "We are working to resolve the issues and find a fair solution for all stakeholders."

Cryptocurrency lending firm Babel Finance also suspended deposit withdrawals due to the market downturn. Babel Finance explained, "Recently, there has been significant volatility in the cryptocurrency market, and some institutions are experiencing a chain of risk events," adding, "This situation has caused abnormal liquidity pressure." Babel Finance's average monthly derivatives trading volume is known to be $800 million (approximately 1.036 trillion KRW), and options trading exceeds $20 billion. Earlier, cryptocurrency-backed lending firm Celsius also announced a temporary suspension of customer asset withdrawals due to a bank run.

Meanwhile, according to cryptocurrency data provider Alternative, the fear and greed index representing investor sentiment remained unchanged at 6 points (extreme fear) compared to the previous day. Alternative's fear and greed index ranges from 0 points, indicating extreme fear and pessimism about investing, to 100 points, indicating optimism.

This content was produced with the assistance of AI translation services.