August 12, 2022

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Troubled crypto world demands new victim: Bitcoin returns below $20,000 |  Financial issues

Troubled crypto world demands new victim: Bitcoin returns below $20,000 | Financial issues

Bitcoin, which rebounded to $21,500 over the weekend, is back on its way down steadily with a dip to $19,900. In the middle of this month, the slowdown was even greater, falling below $18,000.

The turmoil in the cryptocurrency world has not abated. After the drama in Terra, whose value has almost completely evaporated, and the bankruptcy of crypto-lending platform Celsius, another major crypto party has entered with hedge fund Three Arrows Capital (3AC).

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Three Arrows Capital, which saw the light of day in 2012, has been in financial trouble for some time. A major role in this was played by the large position of the Terra hedge fund and another cryptocurrency Luna. While 3AC tried to turn things around with the sale of assets, the failure to make payments on a large $665 million loan led to the company’s decline. In the Virgin Islands where 3AC is located, the court declared bankruptcy on Wednesday.

Bitcoin investors are facing an unprecedented downturn this year. At the beginning of January, the digital currency was still around $46,000, but then fell sharply. After a strong recovery in March, things got worse. A sharp drop in risk appetite due to higher interest rates also played a role in the bleak course of events. At the end of last year, Bitcoin peaked at just under $70,000.

Other cryptocurrencies, such as Ethereum, are also heavily burdened due to the dramatically increased risk aversion among investors. The second largest cryptocurrency is still worth just over $1,000. In April, there was another annual peak of $3,500.

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