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Bitcoin (BTC-USD) fell to its lowest in over two weeks, along with the broader cryptocurrency market, amid growing concerns over crypto-friendly bank Silvergate Capital’s (SI) viability and potential impact on the industry.
The top crypto fell 4.2% to $22.34K at 10.44 am ET, while ether (ETH-USD) was down 3.7% at $1.57K.
Craig Erlam, senior market analyst at OANDA, said the Silvergate (SI) development brings risks of further negative ripple effects in the industry. “This story is a reminder that there could still be more to come and it has undermined confidence in the space.”
Additionally, strong economic data this week suggest that the Federal Reserve could resort to further tightening, which also dented risk sentiment.
“Recent price action signals from the U.S. macro landscape forces us to be a bit more cautious,” said Markus Thielen, head of research at crypto services firm Matrixport. “We would suggest using the September 2022 high ($22.8K) as a stop level and cutting 50% of our crypto exposure if prices trade below this.”
Bitcoin (BTC-USD) fell to as low as $22.26K on Friday. Additionally, centralized exchanges liquidated bullish bitcoin futures worth over $62M during Asian trading hours, the most since August, CoinDesk reported citing Glassnode data.
Thielen said Silvergate (SI) is likely facing more class action lawsuits due to lapses in its due diligence, which “should’ve become aware that the interlinked Alameda, FTX (FTT-USD) and North Dimension accounts were used for fiat on-and-off ramp without being properly licensed.”
Shares of Silvergate (SI) continued their decline, dropping as much as 15.2% to notch a new record low.
Crypto-remining stocks that traded in the red include: Argo Blockchain (OTCPK:ARBKF) -8.5%, Hut 8 Mining -4.9%, Bitfarms (BITF) -4.3%, Coinbase (COIN) -2.1%.
Earlier, Silvergate (SI) hits record low on potential going concern risk.
