Bitcoin Vulnerable to IMF Comments Falls

October 11, 2018 Share Print 0

Bitcoin’s role as a “safe haven” asset in turbulent times is looking more unlikely.

As the U.S. stock market saw its biggest drop since February on Wednesday, the largest digital currency dropped 6 percent along with it. Bitcoin, sometimes referred to as “digital gold,” and other top cryptocurrencies wiped out $13 billion of value in a matter of hours, according to data from CoinMarketCap.com.

Other top cryptocurrencies followed bitcoin’s lead, with XRP and ethereum both tumbling more than 10 percent. The downward moves came after the International Monetary Fund warned that cryptocurrencies “could create new vulnerabilities in the international financial system.”

h
Bitcoin proponents have billed it as a store of value, or “digital gold,” and a possible replacement for traditional currencies.

This week’s market plunge, and this year’s global turmoil, should have made ideal conditions for digital currencies to prove that. The Dow Jones Industrial Average closed more than 800 points lower Wednesday, its biggest loss since February, hurt by quickly rising interest rates and a rout in tech stocks.

While U.S. stock market has otherwise fared pretty well this year, government-backed currencies were dragged down by ongoing Brexit concerns in 2018, and there were growing trade tensions between the U.S., China and European Union.

via CNBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.

Bio
Twitter
Google+
Latest Posts

Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.