Bitcoin Drops Under $50,000 As Crypto Takes $260 Billion Dive

The cryptocurrency market took a $260 billion dive on Friday (April 23), with bitcoin trading below $50,000 for the first time in weeks and other coins tumbling to new lows, CNBC reported.

Bitcoin lost about 10 percent in value, trading at $49,281.40 at around 2 a.m. EST (14:06 p.m. Beijing time), according to CoinDesk data, per CNBC. Ethereum dropped over 11 percent to $2,202.05, and XRP took a 22 percent hit, according to CoinMarketCap, per CNBC.

U.S. stock indexes tumbled on President Biden’s capital tax gain tax hike announcement on Thursday (April 22). 

Vijay Ayyar, head of Asia Pacific and global expansion at Singapore’s crypto exchange Luno, told the news outlet that the markets have experienced an overall acceleration and “it’s probably cooling off before the next leg up.” The stock market decline could also impact “all risk-on assets,” he added. 

The crypto market is known for volatility — bitcoin soared 66 percent this year; Ether, over 200 percent — but the reason for the $260 billion freefall isn’t known. Speculation also points to President Biden’s tax hike plans. 

The overall cryptocurrency escalation was in part triggered by institutional investors and corporate investmenrs from Tesla and Square. Banks have also been easing their way into the crypto market, CNBC reported.

Across the map, authorities from most countries and regions have been investigating the best way to regulate cryptocurrencies like bitcoin. The Deputy Governor of the People’s Bank of China, for example, called bitcoin an “investment alternative,” according to CNBC.

PayPal recently started letting its 350-plus million users use bitcoin and other crypto to make payments. PayPal CEO Dan Schulman said earlier this month that he anticipates that the company’s cryptocurrency service could reach $200 million in volume within months.

PayPal’s peer-to-peer (P2P) payments app Venmo also gives its estimated 77 million users the ability to use cryptocurrency. Customers can buy, sell, and hold bitcoin, Ethereum, Litecoin and Bitcoin Cash. 

The new feature furthers PayPal’s commitment to promoting the use and understanding of digital currencies and cryptocurrencies.