Subsequently, cryptocurrency and blockchain-related stocks dropped in pre-market trading, with Marathon Digital Holding (NASDAQ: MARA), Riot Blockchain (NASDAQ: RIOT), and Coinbase (NASDAQ: COIN) leading the way, dropping 13.7%, 12%, and 12%, respectively. In short, the crypto market hasn’t looked confident all year, after the bull run in 2020 and 2021, while it could be said that a crypto winter began in May when major coins fell along with the stock market.
Aggressive interest-rate increase
As it stands, both crypto assets and stocks have suffered from an aggressive round of interest-rate hikes from the Fed. With the CPI coming in higher than initially expected, market participants may be expecting more rate hikes to come from the Fed to rein in consumer prices. This could be one of the major reasons for the broad market sell-off. On the other hand, crypto miners have seen slowing growth in May, as MARA and RIOT led the way, while Bitfarm (NASDAQ: BITF), HIVE Blockchain (CVE: HIVE), and Core Scientific (NASDAQ: CORZ) saw a slight upside in mining. Yet, it seems that the recession fears will keep the broader markets down, as Alkesh Shah from Bank of America (NYSE: BAC) Securities, writes in a client note.
Reaching its peak
Meanwhile, Celsius Network, one of the biggest crypto lenders, also halted its withdrawals. The announcement from Celsius is a dose of bad news that comes in the wake of recovery from the collapse of the TerraUSD (UST) coin in May. With crypto-assets peaking in November 2021, at around $3 trillion and the current value at ‘just’ $1 trillion, it remains unclear how low can the market go before any signs of recovery are evident. Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
