Prices of major cryptocurrency including Bitcoin are on the decline amid stock markets around the world faltering due to the bankruptcy crisis of Chinese real estate company Evergrande in the middle of FOMC.
According to CoinMarketCap, a global cryptocurrency marketplace, Bitcoin is recording 43,813.42, down 7.39% from 24 hours ago, as of 6:20 a.m. GMT+8 on the 21st. Bitcoin once fell more than 10%. Ethereum, the second largest after Bitcoin, also fell 7.96% to 3,054.83.
There are many claims that Bitcoin is the most useful safe asset, but the story is changing as people learn that prices often fall even more among risky assets, CNBC said. “This year’s Bitcoin rally took place with a Risk-On rally.”
Meanwhile, stock markets around the world are falling en masse as concerns over an economic crisis have risen due to the Everlande bankruptcy crisis.
On the 20th (local time), Dow fell 1.78% on the New York Stock Exchange, S&P 500 1.70%, and NASDAQ 2.19%.
On the European stock market, Germany’s Dax fell 2.31%, Britain’s FTSE fell 0.86% and France’s Cag fell 1.74%.
Earlier in the Asian market, the Hong Kong stock market closed down more than 3% on concerns that Evergrande Group may not be able to pay bond interest coming on the 23rd.
Evergrande Group’s debt is the largest among listed real estate developers around the world, and there are growing concerns among investors that the Chinese government could leave Everlande bankrupt.
Evergrande Group will have to pay $83.5 million in interest on five-year dollar bonds with an 8.25% interest rate due on the 23rd of this week. According to the terms and conditions of the bond, failure to pay interest is considered a default after a 30-day grace period. On the same day, the maturity of the coupon of 232 million yuan in yuan bonds will also arrive.
Concerns have risen sharply that Evergrande bankruptcy could pose a systematic risk to the Chinese financial market and could hurt the global economy.