The price of bitcoin collapsed to a one-and-a-half-month low, following the global stock indices. On Monday, the S&P 500 index fell 2%, which was the largest drop in the last two months. A safe haven asset, the dollar, in turn, rose to a one-month high.
Investors’ withdrawal from risky assets is due to several factors.
First of all, the fall is associated with the threat of default of the second largest developer in China, Evergrande (HK:3333). The company’s debt exceeds $300 billion, and on Thursday it will have to pay interest payments on bonds. The bankruptcy of such a company carries systemic risks for the financial system and the construction industry in China. In addition, this situation may have a negative impact on global stock markets.
The second reason is the expectation of curtailing the Fed’s monetary stimulus. On Wednesday, a meeting of the regulator will be held, from which instructions are expected for the period of the beginning of the reduction in the volume of asset purchases.
Also sources of concern are the events in the US Congress, where lawmakers cannot agree on the adoption of economic support packages. Also in October, the US government debt ceiling will be reached.
According to Bybt, increased volatility led to the liquidation of positions by more than $ 1.2 billion.
The New York Times reported that the Fed considers stablecoins as a serious threat to the economic security of countries around the world, and that regulation is approaching.
According to technical analysis, in case of consolidation below the level of 40,000, a decrease to 37,700 is likely. In case of a return above 44,000, an increase to 46700 is likely.