Bitcoin set for record losing streak

Cryptocurrencies nursed large losses yesterday, with bitcoin back above $30,000 but still set for a record losing streak after the collapse of TerraUSD, a so-called stablecoin, rippled through cryptocurrency markets.

Crypto assets have also been swept up in broad selling of risky investments on worries about high inflation and rising interest rates. Sentiment is particularly fragile, as tokens supposed to be pegged to the dollar have faltered.

Bitcoin, the largest cryptocurrency by total market value, managed to bounce in the Asia session and traded around $30,500 at 1140 GMT. It has staged something of a recovery from a 16-month low of around $25,400 reached on Thursday. But it remains far below week-ago levels of around $40,000 and, unless there is a rebound in weekend trade, is headed for a record seventh consecutive weekly loss.

“I don’t think the worst is over,” said Scottie Siu, investment director of Axion Global Asset Management, a Hong Kong-based firm that runs a crypto index fund.

“I think there is more downside in the coming days. I think what we need to see is the open interest collapse a lot more, so the speculators are really out of it, and that’s when I think the market will stabilise.”

Crypto-related stocks have taken a pounding, with shares in broker Coinbase steadying overnight but still down by half in little more than a week.

In Asia, Hong Kong-listed Huobi Technology and BC Technology Group, which operate trading platforms and other crypto services, eyed weekly drops of more than 20 per cent.

But broader financial markets have so far seen little knock-on effect from the cryptocurrency crash.

Selling has roughly halved the global market value of cryptocurrencies since November, but the drawdown has turned to panic in recent sessions with the squeeze on stablecoins.