Cryptocurrency prices slid Thursday afternoon along with major stock market indexes.
Bitcoin declined 7% to $36,981, from $39,780.33, erasing Wednesday’s gains. Ethereum fell 6.5% to $2,751.88, from $2,943.42 on Wednesday.
Of the top 30 cryptocurrencies listed by CoinDesk, 28 were down on the day.
Apart from a brief selloff in January, bitcoin’s price hasn’t been this low since last July, when it traded as low as $29,000. The largest cryptocurrency is now down about 47% from its November record high of $68,991.
On Wednesday, the central bank announced a half-point rate increase. Fed Chairman Jerome Powell said there may be half-point rate increases in the summer months, but that officials aren’t considering a three-fourths of a percentage point increase.
That drove stocks higher on Wednesday, but they gave back those gains on Thursday, with the Nasdaq Composite down more than 5%.
Over the past two years, more professional traders have found their way into the crypto markets. The effect of that has been that crypto assets have traded more in line with other risk assets, like growth and tech stocks.
The tech heavy Nasdaq Composite Index has fallen almost 21% this year, while bitcoin is down about 20%. Thursday’s selloff comes on top of what was a bad April for crypto prices as well. Bitcoin’s market value fell 17% to $716 billion, according to research firm CryptoCompare.
With Thursday’s selloff, bitcoin’s total market value has fallen to about $700 billion.
The widespread unwinding of risk assets has hit the cryptocurrency market particularly hard, driving down everything from bitcoin to NFTs. It has also started to have an effect on companies in the industry. Crypto companies were surging early in the year, capped when several paid millions of dollars to run ads during the Super Bowl. But the momentum has faded sharply since then.
Coinbase Global Inc.,
one of those Super Bowl advertisers, desktop and mobile-web traffic fell 26% in the first quarter from a year earlier, according to web analytics firm Similarweb Ltd. Mobile app installs in March were down 67% from April 2021, the month the company went public.
Analysts forecast Coinbase’s first-quarter earnings per share will be $0.00, according to FactSet, down from $3.05 a year ago. The company reports earnings on Tuesday.
Write to Paul Vigna at Paul.Vigna@wsj.com
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