Bitcoin price hit $26.8k on Thursday, according to Coin Metrics data. Bitcoin is hovering around $27,000. So, what’s the reason for the last drop?
In the cryptocurrency market, which witnessed the turmoil of stable coin Terra USD (UST), US inflation data accelerated the decline. In the US, the CPI increased by 8.3 percent year-on-year in April, exceeding market expectations. Expectations were for an 8.1 percent increase. Cryptocurrencies fell along with stocks after inflation data.
According to CNBC, the situation that has made investors nervous has led to exits from risky assets, including crypto.
“The crypto market has been under pressure for a while,” says AscendEx venture partner Michael Rinko. Emphasizing the FED, Rinko said, “Stocks continue to fall, and with it crypto. It has created a lot of fear in this market in general.”
Crypto investor Aaron Brown, author of Bloomberg Opinion, stated that the collapse of TerraUSD (UST) negatively affected confidence in all liquidity protocols.
Analysts describe $30,000 as a significant level for bitcoin, the largest cryptocurrency by market cap.
According to the news of CNBC, the rapidly popular stablecoin TerraUSD, which lost almost 100% value last week and broke its 1 dollar fixed, Terra project also negatively affects investors.
DECLINED BELOW 30 THOUSAND DOLLARS
Bitcoin fell below 30 thousand dollars on May 10, and the following comments were made for the decline:
– In line with the negative course in the global stock markets The losses in the crypto money markets also intensified.
– The increase in expectations for tightening in monetary policy, avoidance of risky assets and the dollar index reaching the highest level in 20 years were effective in the negative course in the markets.
-Analysts stated that tightening monetary policy to combat rising inflation and decreasing liquidity are keeping investors away from risky assets in global markets.
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