Due to the weak course of the US stock markets, there are also strong sales in the cryptocurrency market. As of Friday, bitcoin fell below 66 thousand dollars, while the shares of large companies operating in the sector also suffered significant losses. Recently increasing geopolitical risks and central bank policies are deepening the fluctuations in risky assets.
Sharp depreciation in crypto stocks
Shares of Coinbase, one of the leading crypto exchanges in the USA, and Galaxy, the digital asset company, fell by approximately 7 percent. Gemini stock market, on the other hand, recorded one of the steepest losses in the industry, falling nearly 9 percent. Shares of crypto-friendly broker Robinhood also lost almost 6 percent. Although the company accelerated its share repurchase program, this move was not effective in changing the direction of the market.
Companies that include bitcoin in their investment portfolios also received their share of the sales. Shares of Strategy company, managed by Michael Saylor, and Twenty One Capital lost around 6 percent. Bitmine Immersion and Sharplink Gaming, which provide Ethereum-based asset management, also lost approximately 5 percent.
Riot Platforms, CleanSpark, IREN, HIVE Digital and Hut 8, which operate in the mining space, recorded declines of 5 to 8 percent. MARA and Bitdeer shares, which have performed better in recent days, also gave back their gains and fell by 6 percent and 8 percent, respectively.
Fed statements and volatility in global markets
The monetary policy followed by the US Federal Reserve and global economic developments closely affect the pricing in crypto and stock markets. The increase in oil prices and signals of a slowdown in the labor market led to changes in expectations regarding monetary policy.
Richmond Fed President Tom Barkin pointed out that rising fuel prices may negatively affect consumer spending and emphasized that hiring conditions remain sensitive. Philadelphia Fed President Anna Paulson pointed out that the war in Iran poses new risks for inflation and growth.
Richmond Fed President Tom Barkin stated that the increase in fuel costs could harm spending and mentioned a fragile outlook in hiring. Philadelphia Fed President Anna Paulson stated that the war environment in Iran poses new threats in terms of both inflation and growth.
After the 10-year US bond yield approached 4.5 percent on Friday, it reversed its rise with the statements of Fed officials. The two-year bond rate, which is more sensitive to politics, fell to 3.91 percent after reaching 4.03 percent during the day.
While investors’ expectations for an interest rate cut are decreasing, it is thought that the Fed may raise interest rates further in the face of rising inflation.
The sales in the stock market in recent months have negatively affected gold, silver and bitcoin, as well as technology giant companies. Especially in the Magnificent Seven group, which includes Nvidia, Google and Microsoft, the total market value decreased by over 17 trillion dollars. The Nasdaq 100 index fell more than 10 percent below its historical peak and entered the correction zone. The S&P 500 lost 8.5 percent of its value.
