Fear of United States interest rate hike causes liquidation of 74K crypto investors

Investors continued to stay away from riskier assets as the United States central bank is widely expected to announce a 75 basis point interest rate hike later this week. This has caused bitcoin to fall to the $20K level amid increasing sell-offs.

In the crypto derivatives market, those that dared paid the huge price as 73,995 traders were liquidated for the day, bringing the total liquidations to $208.99 million. The greatest single liquidation order, worth $1.57 million in ETH-USD-SWAP, occurred on Okex.

The price of bitcoin is at a pivotal point; a strong increase in either direction could determine the direction of the asset’s trajectory after the FOMC meeting.

Investors are currently undecided, but this is likely to change once it is announced that interest rates will rise as predicted by economists. Holders of bitcoin are being cautious ahead of a predicted increase.

  • The price of bitcoin was recently at $21.1K, down about 5% from the previous day. Early on Monday (UTC time), bitcoin started to decline as investors once again expressed concern about the Federal Reserve and other central banks’ capacity to control inflation without sending the economy into a deep recession. Since reaching $24,000 last Wednesday and raising optimism that it had bottomed out, bitcoin has dropped for four straight days.
  • The second-largest cryptocurrency by market cap, ether, was recently trading below $1,500, down more than 8% during the same time span and far from its most recent high near $1,600. AVAX and MATIC, two other significant altcoins, both fell by over 10% at one point, were also swimming in red.
  • A scandal that is likely to continue to plague the cryptocurrency industry for at least the foreseeable future took another turn on Monday when lawyers for bankrupt crypto lender, Voyager Digital called an offer by FTX to provide early liquidity to Voyager customers, a “low-ball bid dressed up as a white knight rescue” that only benefits FTX. This month, Voyager filed for Chapter 11 bankruptcy protection.

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