The world’s largest cryptocurrency, bitcoin, dropped below the $44,000 level on Monday as concerns over global equities spilled over into crypto markets.
The digital asset lost as much as 10% during the day’s trading, falling to $43,692.57, according to Coin Metrics. Other cryptocurrencies were also in the red, with ether losing 9% to $3,038.74 and XRP becoming the worst performer, down 14% on Monday.
“This sell-off is the continuation of a well-established pattern where traders cash in their riskier assets to cover margin calls or sit on the sidelines until markets calm down and they feel more comfortable going back into riskier positions,” Leah Wald, CEO at crypto asset manager Valkyrie Investments, told CNBC. “If ever bitcoin had the opportunity to establish itself as a safe haven or as digital gold, with US companies also signaling their earnings calls are going to reveal poor results, now feels like the time.”
The decline of cryptocurrencies comes amid a broader sell-off in the global equity markets due to fears from the mounting problems at China’s embattled property giant Evergrande.
“Investors look to be taking risk off the table on fears that [a] crisis at China Evergrande Group may become a systemic problem to global markets,” Pankaj Balani, CEO of Delta Exchange, told CoinDesk. “Markets will also be looking at the Fed commentary later this week to make sure that there are no changes in liquidity from the central bank.”
Speculation that the US government may declare stablecoins as a risk to the financial system could be adding to uncertainty in the cryptocurrency market, experts say. The president’s Working Group on Financial Markets is currently advancing a report on stablecoins. The Fed is also expected to issue a report on central bank digital currencies this month that could touch on stablecoin risks.
Meanwhile, El Salvador used the cryptocurrency slump and bought 150 additional bitcoins. “We just bought the dip. 150 new coins! El Salvador now holds 700 coins,” the country’s President Nayib Bukele tweeted on Monday.
Despite the slide, bitcoin has risen almost 50% so far in 2021.
While the traditional fiat money system allows fat cats to take control of people’s lives, monetizing energy and politics, bitcoin is a game changer that could end this monopoly.
Max Keiser discusses the looming collapse of the fiat world in his interview with Pierre Noizat, CEO and founder of Paymium.com, Europe’s longest-running bitcoin exchange.
Ankara is discussing new contracts for gas supplies with a number of countries, including Russia, Turkish Deputy Energy Minister revealed on Tuesday.
“This year will be very difficult for all of us. But we are on good terms with our current suppliers, such as Azerbaijan and Russia. We are discussing new volumes of supplies, new contracts, because some contracts, for example, with [Russian state-run energy giant] Gazprom, expire at the end of the year,” Alparslan Bayraktar told reporters on the sidelines of the ongoing Gastech international conference in Dubai.
He noted that potential supply contracts are being discussed with other gas-producing countries as well.
According to the official, Turkey expects to conclude a long-term agreement on gas transit with Russia in the near future.
Bayraktar added that Turkey is interested in liquefied natural gas (LNG) deliveries, but noted that with Russia, priority is given to pipeline gas.
According to the minister, by the end of 2021, annual gas consumption in Turkey is expected to reach 60 billion cubic meters, and projected to grow to about 70 billion cubic meters per year in the future.
Russian gas is mainly delivered to Turkey via the TurkStream pipeline running from Russkaya compressor station near Anapa in Russia’s Krasnodar Region, crossing the Black Sea to the receiving terminal at Kıyıköy. TurkStream replaced the South Stream project that was cancelled in 2014. According to recent data from Gazprom, natural gas deliveries from Russia to Turkey in the first half of 2021 jumped threefold to 14.623 billion cubic meters.
The debt fallout from China’s major real estate developer Evergrande hit global equity markets this week, spilling over into the cryptocurrency sector.
Boom Bust’s Ben Swann analyzes the situation as bitcoin’s hedge status comes into question.
The Russian government expects the country’s economy to grow by 4.2% this year, Prime Minister Mikhail Mishustin announced at a meeting on Tuesday.
“The recovery of the Russian economy after a rather difficult period is becoming more and more stable. By the end of this year, we expect GDP growth at 4.2%. This suggests that anti-crisis measures have proved their effectiveness,” Mishustin said.
Earlier, Russia’s Ministry of Economic Development published its own forecast, stating the same figure for Russia’s GDP in 2021 and predicting a further 3% growth in 2022. According to the head of the department, Maxim Reshetnikov, with the gradual withdrawal from the OPEC + oil output deal set for 2022, the country’s oil industry will be restored to pre-pandemic level and contribute to GDP growth.
Meanwhile, the Paris-based Organization for Economic Co-operation and Development (OECD) also improved its outlook for Russia’s GDP growth in 2022 to 3.4%, which is 0.6% higher than its May estimates.
In its September report published on Tuesday, the OECD noted that Russia, as well as Argentina, Brazil, Mexico and Turkey, saw “unexpected increases in inflation” that “will continue for some time.” However, it also stated that “tightening monetary conditions in many of these countries should nevertheless help curb domestic price pressures, especially by the second half of 2022.”
