Bitcoin, the leading cryptocurrency by market capitalization, experienced a significant drop on Monday, briefly falling below $50,000 amidst one of the most severe global market sell-offs in recent years. This decline coincides with Hong Kong’s efforts to enhance its virtual assets sector.
On Monday, Bitcoin’s value plummeted by as much as 15%, dipping below the $50,000 mark for the first time in several months before staging a slight recovery. Similarly, Ether, the second-largest cryptocurrency, saw a nearly 20% decline.
The cryptocurrency crash occurred against the backdrop of a global stock market downturn triggered by fears of a U.S. recession and a sharp appreciation of the Japanese yen.
Bitcoin, which hit an all-time high of nearly $74,000 in March, has been struggling recently. Over the past week, its value has fallen by nearly 20%, continuing a broader downward trend.
The market downturn led to the liquidation of more than $1 billion in bullish cryptocurrency positions within the last 24 hours, according to data from market provider Coinglass.
Additionally, the sell-off impacted Hong Kong’s exchange-traded funds (ETFs) that track Bitcoin and Ether prices. For instance, ChinaAMC’s spot Bitcoin ETF experienced its largest single-day outflow since its launch in April, with a withdrawal of HK$35.19 million (approximately $4.5 million).
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