Bitcoin's faltering around the $20,000 mark continues.

On Monday morning, the oldest and still the largest crypto asset fell as low as $18,322 and has recovered little since.

This is the lowest level since December 2020. At the beginning of the year, more than $60,000 was paid for a bitcoin.

In the downward trend, the price stayed longer or shorter at each round mark, so that a new low always harbors the risk of a further slide.

Martin Hock

Editor in Business.

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The reason given for the recent price low is the prospect of further drastic interest rate hikes by the major central banks, which is why investors are withdrawing from riskier asset classes such as crypto assets.

The price of the second most important crypto asset Ethereum also fell to $1285.20, its lowest level since mid-July.

In July and August, Ethereum benefited from a change in the underlying blockchain to a faster and more environmentally friendly process.

However, this effect seems to have fizzled out now that the changeover has been completed.

Other crypto assets such as XRP or Polkadot recorded even greater price losses.

The price of the additional “token” Ethereum POW, which investors received as part of the transition and which embodies much of the historical blockchain, also fell further and is now down 40 percent.

Higher interest rates mean higher borrowing costs and therefore lower liquidity, which is essential for crypto assets.

In the current inflationary environment, macroeconomic data trumps everything, writes Antoni Trenchev, managing director at crypto lender Nexo, also commenting on the positive effects of the Ethereum switch.

XRP is also negatively impacted by reports that the dispute between Ripple Labs and the SEC over Ripple's statements that XRP is not a regulated asset should be decided immediately.

Meanwhile, Bloomberg news agency reports that Do Kwon, the crypto investor behind stablecoin TerraUSD, whose collapse is believed to be one of the main triggers of the recent crypto bear market, appears to be evading legal responsibility.

Kwon had initially moved to Singapore, but according to the local authorities he is no longer there and his whereabouts are apparently unclear.

An arrest warrant had been issued against him in South Korea for moving to Singapore.

Kwon, on the other hand, announced on the short message service Twitter over the weekend that he had nothing to hide and was fully cooperating with the authorities.

They are defending themselves in numerous jurisdictions and have maintained an extremely high level of integrity and look forward to clarifying the truth in the coming months.

However, he did not reveal his whereabouts.

According to the South Korean news agency Yonhap, however, according to the country's prosecutor's office, Kwon is not cooperating with the investigation and has informed his lawyer that he has no intention of being questioned.

Meanwhile, the self-proclaimed “Bitcoin nation” of El Salvador threatens to plunge into chaos after President Nayib Bukele unconstitutionally announced his re-election for 2024.

Bukele had declared a state of emergency six months ago, allegedly to combat gang crime.

A good year ago, the President made Bitcoin the state currency in order to become independent of international financial markets and to combat inequality.

But neither the promised large-scale investments nor more prosperity came.

Recently, rating agencies Moody's and Fitch downgraded the country's credit ratings after its bonds traded at deep discounts following the crypto market collapse.

Moody's estimates the country's unrealized Bitcoin losses at $57 million.

The government announced it would buy back $360 billion in bonds maturing in 2023 and 2025 to bail out the economy.

The expected interest rate hikes will also put the price of gold under pressure again.

At around $1660, the price of the precious metal fell to its lowest level since April 2020. On the other hand, the US dollar, which is considered a safe haven in economically difficult phases, is still in demand.

With the last 110.06 points, the dollar index, which reflects the value of the currency in relation to the most important partner currencies, is once again heading for a 20-year high.

At currently $0.9978, the euro is again below par with the American currency.