Bitcoin Drops Below US$23,000, Ether Slides Across the Board in Crypto Price Drop

Bitcoin and Ether prices fell during Friday morning trading in Asia, along with all the other top 10 unstable cryptocurrencies, amid reports that US-based cryptocurrency bank Silvergate Capital Corp. could be the next business victim of the FTX crash. Polkadot led the losses. US stocks rose Thursday after a week of swings amid conflicting comments from the Federal Reserve on interest rates and data suggesting inflation is firmly entrenched in the economy.

See related article: Bitcoin’s price increases this year bring much-needed relief to the cash-strapped crypto mining industry

Quick Facts

  • Bitcoin fell 3.22% over the past 24 hours to US$22,827 as of 9:30am Hong Kong, according to data from CoinMarketCap, extending its weekly loss to 4.78%. Ether fell 3.19% to US$1,602, for a seven-day drop of 3.33%.

  • Both tokens fell as much as 5% later on the Asia morning. Despite the slump, both are still up about 40% for the year to date.

  • Polkadot led the losers among the top cryptocurrencies, falling 6.00% to US$6.08 and losing 14.63% in the past seven days. The token has been in a downtrend for two weeks, though the Polkadot community remains active and leading daily development on Github, according to Github tracker Evidence from Github on Thursday.

  • Silvergate said in a filing with the U.S. Securities and Exchange Commission (SEC) on Thursday that the company is “assessing its ability to continue as a going concern, which led to a more than 50% plunge in its stock price. A series of crypto exchanges and platforms have cut ties with the bank.

  • As a member bank of the Federal Reserve, Silvergate positioned itself as a gateway between traditional finance and crypto. The bank was hit hard by the collapse of FTX and reported a $1 billion loss for the fourth quarter of 2022. In January, it laid off 40% of its staff.

  • The total market capitalization of cryptocurrencies fell 1.02% in the past 24 hours to $1.07 trillion. And total trading volume in the past 24 hours fell 12.30% to $42.65 billion.

  • US stocks closed higher on Thursday. The Dow Jones Industrial Average was up 1.05%, the S&P 500 was up 0.76% and the Nasdaq Composite Index was up 0.73%.

  • Raphael Bostic, president of the Atlanta Fed, said on Thursday that he supports a 25 basis point rate hike in March, allaying recent concerns about a possible 50-point hike by the Fed. This helped stocks rise higher, but the market is caught in countercurrents, as Fed Governor Christopher Waller said the same day that recent data suggests the inflation battle is far from over.

  • Data from the U.S. Department of Labor on Thursday showed that initial jobless claims fell in the week ending Feb. 25 while labor costs rose, indicating that inflation has so far not been tamed by the Fed’s rate hikes.

  • The Fed set US interest rates between 4.5% and 4.75% in February, the highest since October 2007. CME Group analysts expect a 72.3% chance that the Fed will raise interest rates by another 25% this month. basis points will increase. They also predict a 27.7% chance of a 50 basis point increase, down from 29.9% on Thursday.

  • Data from the US services sector is expected on Friday and several other Fed officials are due to speak the same day, further compounding mixed messages to markets. Separately, this weekend China will kick off its so-called “Two Sessions,” the year’s most important political gatherings for setting economic policy in the world’s second-largest economy.

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