(Bloomberg) — Cryptocurrency prices slumped as a broad selloff sparked by worries about contagion from China Evergrande Group swept through global markets.
Bitcoin dropped 7.3% to $44,127 as of 7:33 a.m. in New York, reaching the lowest level in a week. Other digital assets also retreated, with Bitcoin Cash, EOS and Ether all declining.
The losses mirrored the action in the broader market as investors weighed the risks coming from Evergrande’s debt woes and this week’s Federal Reserve meeting. U.S. equity futures pointed to losses at the open and the Stoxx Europe 600 index dropped as much as 2%, on track for the biggest decline since July.
“Some have attributed the sudden dip to the currently ongoing Evergrande situation in China which has already caused turmoil in traditional markets,” wrote Jonas Luethy, a sales trader at GlobalBlock, the U.K.-based digital asset broker. “Analysts have suggested a choppy week is ahead, with a potential pullback to as low as $41,000.”
El Salvador’s President Nayib Bukele said the country had “bought the dip,” in Bitcoin, adding 150 tokens to raise its total holdings to 700 — about $32 million based on current pricing. The nation recently adopted Bitcoin as legal tender in a controversial move that met with technical glitches and protests.
El Salvador’s enthusiastic adoption of Bitcoin is one of the reasons why prices have been trending higher and recently hit a four-month high. Still, the market has a way to go before recovering losses since a selloff in May.
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