Bitcoin dropped less than $20,000 to the lowest level since mid-July as investors abandoned risk assets

September 01, 2022: -On Monday, Bitcoin decreased below $20,000 as investors dumped risk assets following the Federal Reserve affirmed its dedication to a rough tightening path.

The world’s substantial digital currency decreased 5% from Friday’s close to hitting an intraday low of $19,526 overnight, a level not seen since July 13, according to Coin Metrics data. Other primary digital tokens also sold off, with ether tracking to $1,423, its lowest level in a month. Bitcoin last traded at $20,266 apiece.

The sharp refusal of cryptocurrencies coincided with a big sell-off in U.S. stocks, triggered by Fed Chairman Jerome Powell’s fierce commitment to wait for inflation in a speech in Jackson Hole, Wyoming. The Dow Jones Industrial Average dropped 1,000 points on Friday after Powell said he expects the central kitty to resume growing interest rates that will cause “some pain” to the U.S. economy. Stocks sold off again on Monday.

“Bitcoin weakened following Fed Chair Powell didn’t blink with his reiteration that the Fed will tighten policy to bring drop inflation,” said Edward Moya, senior market analyst at Oanda. “Risky assets are struggling as Powell’s fight for inflation remains aggressive even as it will trigger an economic slowdown.”

For its fourth negative week, Bitcoin plunged more than 3% in the previous week. The cryptocurrency is down more than 50% this year and remains 70% off its all-time high price of $68,990.90 in November.

The crypto market is plagued by a few issues, which include the collapse of algorithmic stablecoin terraced, flashing a chain of events that led to the bankruptcy of lending outlet Celsius and hedge fund Three Arrows Capital.