Investors’ fear, uncertainty cause crypto market to record loss of some $90B
Bitcoin and cryptocurrencies on Friday were trying to recover from the previous day’s massive losses amid investors’ worries surrounding the sudden demise of Silicon Valley Bank (SVB),the largest bank in the tech-heart of the nation.
The price of Bitcoin, the world’s largest cryptocurrency by market value, fell 6.2% on Thursday, and dove Friday to as low as $19,549 at 5 a.m. EDT. It later partially recovered to climb just above $20,000 at 3 p.m. EDT.
Ethereum, the world’s biggest altcoin by market value, also declined 6.2% on Thursday before diving to $1,368 early Friday. It was trading at $1,422 at 3 p.m. EDT.
Some altcoins saw their price plummet more than 10% during that period.
The total value of the crypto market was down to $912 billion, from just above $1 trillion, during the same period, recording a loss of approximately $90 billion, according to data from the digital asset price-tracking website CoinMarketCap.
The rapid sell-off in cryptos came as investors felt fear and uncertainty in the tech sector surrounding the sudden collapse of SVB, as CEO Greg Becker said Wednesday the bank has sold “substantially all” of its securities portfolio.
Although SVB sold its $21 billion bond portfolio at a $1.8 billion loss, Becker said in a statement that the bank’s exposure to crypto is minimal.
SVB, earlier Friday, was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver.
After FDIC said all insured depositors will have full access to their deposits no later than Monday morning, Bitcoin and cryptocurrencies saw some price recovery.