Concerns about high inflation and rising interest rates have prompted widespread dumping of hazardous investments, including crypto assets.
However, sentiment is particularly shaky, as tokens that were intended to be tethered to the dollar have failed.
Bitcoin, the most valuable cryptocurrency by market capitalization, attempted a recovery early in the Asian session, rising 2% to $29,500, a recovery from a 16-month low of roughly $25,400 on Thursday.
It is still trading well below week-ago levels of around $40,000 and is on track for a record sixth consecutive weekly loss unless weekend activity improves.
“I don’t believe the worst is gone,” Scottie Siu, investment director at Axion Global Asset Management, a Hong Kong-based firm that manages a crypto index fund, said.
“In the following days, I believe there will be further downside. I believe we need to see the open interest fall much more, so the speculators are forced out of the market, and then the market will stabilize.”
This week, TerraUSD (USDT) lost its 1:1 peg to the dollar, as its method for maintaining stability, which relied on another digital token, failed under selling pressure.
It last traded for less than ten cents.
According to CoinMarketCap data, Tether, the largest stablecoin and one whose makers claim is backed by dollar assets, has also been under pressure, falling to 95 cents on Thursday.
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