Bonfire of bitcoin: Why crypto assets are tumbling

economictimes.indiatimes.com:

crypto assets like bitcoin had swelled a volatile sector to a valuation of roughly two trillion dollars recently. A week-long rout has wiped away tens of billions of dollars from that value and spread panic throughout the market. — Bitcoin blues Bitcoin is the

cryptocurrency and its value accounts for the lion's share of the whole sector.

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This week, its price at one stage plummeted to $25,500 — less than half of its record price in November last year and the lowest valuation since it exploded at the end of 2020. «Fears about rampant inflation and the abrupt ending of the era of cheap money have sent cryptocurrencies careering down a cliff edge,» said Susannah Streeter of Hargreaves Lansdown, referring to the new monetary tightening policies of the US Federal Reserve and other central banks. She said the new environment had prompted investors to «scuttle away from risky assets». Bitcoin began to slide at the same time as stocks in technology companies, but the collapse has been more marked in the volatile crypto sector. Many other coins also lost value, including the second most important, ether, which plummeted by a third in the course of the week.-Not so stablecoinsAs the biggest cryptocurrencies are famously volatile, entrepreneurs invented a theoretically more reliable alternative known as stablecoins. These coins, making up a market worth around $180 billion according to a March estimate from the US Fed, are pegged to the US dollar or other fiat currencies. But this week one of