Bitcoin’s woes continue, as the asset plunged to a fresh two-month low of $19,500 yesterday before bouncing over $1,000.
This comes amid woes at Silicon Valley Bank and the apparent exposure of certain crypto companies, including Circle and its stablecoin, which lost its peg to the dollar.
Volatile BTC around $20K
In a matter of almost a week, bitcoin had calmed down around $22,000 and failed to produce any significant movement in either direction. However, the asset is known for its volatile nature and such occasions are quite rare. In fact, they are often followed by intensified fluctuations.
This is precisely what happened on Thursday when the cryptocurrency plunged by nearly $2,000. While the reasons are still debated, BTC continued to fall, falling as low as $19,550 (on Bistamp) to record its lowest price point in two months.
Bitcoin reacted well to this massive price drop. It shot up above $20,000 almost immediately and headed towards $21,000. However, the bears played back at this point and reversed their trajectory. As of now, the asset sits inches above the coveted $20,000 line.
Its market capitalization is still below $400 billion, while its dominance over alternatives has increased slightly to 42%.
USDC loses its peg
It’s rare to talk about stablecoins during a market watch, but the picture is different today. When news broke that Circle has about $3.3 billion of its USDC reserves in troubled SVB bank, the second-largest stablecoin started to lose its peg to the dollar. It went down to $0.93 almost instantly and fell further to $0.9 as of this writing. Its market capitalization has dropped by more than $5 billion in one day as investors turn to other stablecoins.
Altcoins, which are supposed to be much more volatile than stablecoins, are in slightly better shape today. ETH has recovered $1400 after a 2.3% rise. BNB is close to $275. ADA, DOGE, DOT, SHIB and AVAX are also higher gainers.
On the other hand, MATIC and SOL have shot up between 5% and 6% in one day above $1 and $17.5, respectively.
Total crypto market capitalization has added around $10 billion since yesterday, but it is still well below $1 trillion.
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