Crypto Prices Slump Over the Weekend

The Bitcoin market dropped over the weekend, matching the stock market's decline.

According to CoinDesk pricing, the world's biggest cryptocurrency, bitcoin, plummeted to $34,656 on Sunday afternoon, down 3.9 percent from Friday evening. Bitcoin fell below $34,000 earlier this afternoon, about half of its all-time high of $67,802 set in November.

Ethereum, the second-largest cryptocurrency, was trading at about $2,565 on Sunday afternoon, down 5.1 percent from Friday at 5 p.m. EDT.

Bitcoin and other cryptocurrencies are notorious for their wild price volatility. 

For years, individual investors dominated the market, but institutional investors, such as hedge funds and money managers, have begun to take control.

The market has become more aligned with regular markets as more professional investors trade crypto. Many institutional investors that acquire cryptocurrencies see them as high-risk investments, akin to equities in the technology sector. During periods of market turmoil, investors prefer to flee to safer areas.

Last week, the stock market fell the day after the Federal Reserve issued a half-point rate hike, the largest since 2000, to combat inflation. Additional rate hikes are possible this summer, according to Fed Chairman Jerome Powell. 

Some of the central bank's $9 trillion asset portfolio is also being unwound.

The Nasdaq Composite, which is heavily weighted in technology, fell to a 52-week low of 12144.66 on Friday. It is down 22% so far this year.

For most of 2022, cryptocurrency prices remained flat as investors braced for higher interest rates. According to CoinMarketCap, the crypto market was busy over the weekend, with $112 billion in market volume in a 24-hour period. The total value of the cryptocurrency market is currently $1.59 trillion.