Bitcoin fell 8.6 percent on Thursday to under $36,000. The cryptocurrency is down more than 30 percent over the past two weeks and has fallen roughly from its recent highs.
For comparison, Facebook’s market cap was $753 billion on Thursday afternoon, while Apple Inc.’s was $702 billion—both significantly higher than Bitcoin’s current worth.
The widespread unwinding of risk assets has hit the cryptocurrency market particularly hard, driving down everything from bitcoin to NFTs. It has also started to have an effect on companies in the industry. Crypto companies were surging early in the year, capped when several paid millions of dollars to run ads during the Super Bowl. But the momentum has faded sharply since then.
With Thursday’s selloff, bitcoin’s total market value has fallen to about $690 billion, according to CoinDesk. That’s down more than 70% from its peak just a few months ago and lower than it was at this point last year—when bitcoin was worth roughly $300 billion less than it is today.
This is not only bad news for bitcoin traders who were hoping to make money off their investments, but also for people who are looking to use cryptocurrencies as an alternative form of payment or store of value.
The selloff comes after a series of regulatory actions by governments across the globe and a string of fraud cases involving initial coin offerings (ICOs). Cryptocurrencies have traded more in line with other risk assets, like growth and tech stocks.
On Wednesday, the central bank announced a half-point rate increase. Fed Chairman Jerome Powell said there may be half-point rate increases in the summer months, but that officials aren’t considering a three-fourths of a percentage point increase.
That was enough to spook investors who have been betting on a continuation of low rates and easy money policies by central banks worldwide after years of cheap credit spurred growth in stocks and other assets across markets around the world but also led to unsustainable levels of debt in many countries including China where borrowing levels are now at an unsustainable level.
The U.S. dollar index rose 0.2% to 94.062 while gold fell 0.2% to $1,254 an ounce.
Bitcoin is notoriously volatile and sensitive to news events and developments within the cryptocurrency market and beyond; it also tends to be highly correlated with other cryptocurrencies like Ethereum or Litecoin (LTC).