Bitcoin dropped below $20,000 on Saturday to its lowest level in 18 months, extending its slide as investors pull back from riskier assets amid rising interest rates.
The biggest cryptocurrency was down 7.1 per cent to $18,993 at 0906 GMT, having earlier touched $18,732, its lowest since December 2020.
It is down about 59pc this year, while rival cryptocurrency Ethereum-backed ether is down 73pc.
The digital currency sector has been pummelled this week after cryptocurrency lending company Celsius froze withdrawals and transfers between accounts.
The sector has also suffered losses after companies such as Coinbase Global Inc, Gemini and Blockfi said they would lay off thousands of employees as investors ditch risky assets.
Crypto funds saw outflows of $102 million last week, according to digital asset manager CoinShares, citing investors’ anticipation of tighter central bank policy.
The value of the global crypto market has tumbled 70pc to under $900 billion from a peak of $2.97 trillion in November, CoinMarketCap data shows.
“The ripples running through the market haven’t stopped yet,” said Scottie Siu, investment director at Hong Kong-based Axion Global Asset Management. “I think we’re still in the middle of it unfortunately, the game isnt over.”
Celsius has hired restructuring lawyers and is looking for possible financing options from investors, the Wall Street Journal reported, citing people familiar with the matter. Celsius is also exploring strategic alternatives including a financial restructuring, it said.
Smaller cryptocurrencies, which tend to move in tandem with bitcoin, also fell. Ether, the second largest token, fell as much as 12pc to $1,045, a new 15-month low.
The chaos in the crypto market has spread to other companies, with a number of exchanges slashing workforces.
Major US exchange Coinbase Global Inc said on Tuesday it will cut about 1,100 jobs, or 18pc of its workforce. Gemini, another US exchange, said this month it would cut 10pc of its workforce.
Still, others are continuing to hire. Binance, the world’s largest exchange, said on Wednesday it was hiring for 2,000 positions, and US exchange Kraken said it had 500 roles to fill.
“Hunker down,” tweeted Binance CEO Changpeng Zhao.