The price losses on the market for digital currencies are widening.

On Monday, one bitcoin was just over $23,000.

The oldest and therefore best-known digital currency was last listed this low in November 2020. This means that all price gains of the last year and a half are gone.

As a reminder, in November 2021, one bitcoin cost more than $66,000.

In the past seven days alone, the price has fallen by 20 percent.

Franz Nestler

Editor in Business.

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The second largest digital currency, Ethereum, has lost around 36 percent within a week and is still trading at around $1,200.

As recently as November 2021, when the entire crypto market was bullish, Ethereum cost four times as much at $4800.

Of course, this is also noticeable on the entire crypto market: The market capitalization of all digital currencies is now – also for the first time since November 2021 – less than 1000 billion dollars.

At that time it was almost 3 trillion dollars.

In the course of this development, Bitcoin's dominance has also increased in recent weeks - from around 40 to 47 percent.

This pattern has been observed many times before: when the market is moving, the remaining investors then turn to the largest currency.

This then results in higher exchange rate losses for the alternative currencies.

Celsius Network stops paying out

The current drop in prices is mainly related to the company Celsius Network.

It has announced that it will suspend withdrawals and transfers between accounts for the time being.

In a blog post, the company says, "We are taking this necessary action to stabilize liquidity and operations while taking steps to preserve and protect assets." This is raising concerns that the company may go bankrupt.

Because the Celsius Network lends cryptocurrencies, grants loans secured with cryptocurrencies and offers savings products for customers.

Most recently, around 12 billion dollars were managed.

So far so good.

But the website also promises returns of up to 17 percent.

How and whether this can be achieved at all in the current market environment is highly doubtful.

Concerns about interest rates are repeatedly cited as the reason for the long-term negative trend on the crypto market.

But at the same time, it is doubtful that such traditional financial data will actually have any impact on digital currencies.

Anyone who relies on Bitcoin or other cryptocurrencies will presumably not compare the prices with stocks or bonds or withdraw from the market - digital currencies are so risky that you should always have priced them in.

High interest rates make the markets tremble

Specifically, central banks are currently raising interest rates around the world.

There is concern that the US Fed could raise interest rates even more than previously thought given the persistently high level of inflation.

The European Central Bank is also exiting its ultra-loose monetary policy.

High interest rates make loans more expensive and bonds more attractive at the expense of stocks - and you can see that on the markets at the moment.

The German share index Dax lost 2 percent on Monday to less than 13,500 points.

The leading German index has lost 16 percent since the beginning of the year.

In the United States, too, the major indices have been falling for months: the Dow Jones has also lost around 15 percent in value.

Only technology stocks were hit even harder: the Nasdaq 100 has lost around 30 percent since the beginning of the year.

In return, bond yields are rising: by midday, the yield on ten-year Bunds had risen to 1.58 percent.

This is the highest level since mid-2014. Two-year federal securities yielded more than one percent for the first time since 2011.

The euro rate also fell, one euro was quoted at 1.0472 dollars and thus at a monthly low.