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Bitcoin had fallen as Evergrande sold-off affects crypto!

Global markets are spooked by concerns about the Evergrande crisis, sending Bitcoin lower.

According to cryptocurrency tracker Coindesk, bitcoin dropped 5.7% in 24 hours, and was trading at $42,955 per coin at 2:43 am last month.

The stock was down 12% earlier this year.

There are also tumbles in other cryptocurrencies. Dogecoin had fallen about 6% and Ethereum had declined 4.4% in 24 hours, respectively.

Stocks plunged on Wall Street on Monday following a big drop in US stocks. A massive Chinese property conglomerate at risk of default has upset investors with its deepening crisis.
While the Dow (INDU) recorded its worst day since July, the S&P (SPX) and Nasdaq (COMP) finished their sessions with their worst performances since May.

Beijing has described Evergrande’s problems as a major test, with some commentators concerned that the company may create China’s Lehman Brothers. The crisis at Evergrande has sent shockwaves all over the world despite other analysts saying it might not.

A portion of the company’s bank loans were supposed to be repaid, according to reports. The company has hundreds of billions of dollars of loans and is having trouble managing them. An inquiry from CNN Business for comments on the payments was not responded to by Evergrande.

According to Refinitiv, two of its bonds valued at more than $100 million was also due interest that week. On a Tuesday, last month, Evergrande shares fell 5.7% in Hong Kong, extending losses from Monday.

Investors around the world are worried about the company, even though it serves primarily mainland China. Market stability has long been considered in jeopardy because of the significant amount of money borrowed by Chinese companies. As a result, investors fear Evergrande and similar firms might expose banks to a number of risks.

Among the Dow’s worst-performing banks on Monday were Goldman Sachs (GS) and JPMorgan (JPM).

Hong Kong markets were already slammed earlier when Chinese banks, insurers and real estate firms were hit.

Senior market analyst Edward Moya said bitcoin is akin to other assets, according to a report.

“The fallout from the Evergrande is putting a tremendous dent in risk appetite that is sending everything lower,” he wrote in a note to clients.

Moya noted that cryptocurrencies had performed well this year, “despite all the volatility.”

“So it should not surprise Wall Street they are the first asset sold in the beginning of China-driven market selloff,” as investors aim to cash in, he added.

Others have taken the occasion to double down. Nayib Bukele, the president of El Salvador who is known for his bullish stance on bitcoin, tweeted lat month, “we just bought the dip.”

It now holds 700 bitcoins, after purchasing 150 bitcoins.

Bukele announced last month that El Salvador had become the first country to adopt the digital currency as its official currency.

The author is grateful for the contributions of Anneken Tappe and Laura He.

Written by IOI

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