Bitcoin Slides Below $37,000 as Investors Unwind Risky Bets

Cryptocurrency prices slid Thursday afternoon along with major stock market indexes.

Bitcoin fell to $36,431.57 at 5 p.m. ET, down 8.4% from Wednesday, according to Dow Jones Market Data. Ethereum fell 6.4% to $2,754.37.

Of the top 30 cryptocurrencies listed by CoinDesk, 29 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 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 more than 21% this year, while bitcoin is also down 21%. 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.

WSJ’s Dion Rabouin explains why Wall Street is now betting big on crypto and what that means for the new asset class and its future. Photo composite: Elizabeth Smelov

With Thursday’s selloff, bitcoin’s total market value has fallen to about $690 billion, according to CoinDesk.

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.

For

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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Appeared in the May 6, 2022, print edition as ‘Bitcoin And Other Digital Money Fall.’