As cryptocurrencies continue to lose ground, Bitcoin falls to a three-month low.
- The price of bitcoin plummeted below $41,000 on Friday, reaching its lowest level since September 29, according to Coin Metrics statistics
- The Federal Reserve's hawkish comments this week sparked a sell-off in global stock markets, which spilled over into cryptocurrencies.
- The world's second-largest bitcoin mining hub, Kazakhstan, has had an internet outage, which has weighed on cryptocurrency prices.
Bitcoin fell to a three-month low late Friday, owing to concerns about tighter US monetary policy and an internet outage in Kazakhstan, the world's second-largest bitcoin mining hub.
The price of bitcoin fell below $41,000 to $40,749.90 soon after 10:50 a.m. ET on Friday, reaching its lowest level since Sept. 29, according to Coin Metrics data. It was last trading down 2.9percent at a price of $41,947.75.
The world's largest cryptocurrency began to tumble earlier this week as minutes from the Federal Reserve's December meeting suggested the bank might reduce its post-pandemic stimulus.
The hawkish remarks sparked a sell-off in global financial markets, which then spread to cryptocurrencies. Bitcoin proponents frequently claim that the commodity is unrelated to traditional financial markets; nonetheless, analysts are increasingly noticing similarities between the price movements of bitcoin and stocks.
Other digital currencies continued to lose ground on Friday, with ethereum down 6.8% and solana down 7.7%.
Another piece of news weighing on crypto prices is Kazakhstan's president's decision to shut down internet connectivity in the aftermath of fatal anti-government rallies.
The Central Asian country processes 18% of the bitcoin network's processing capacity, according to the Cambridge Centre for Alternative Finance. Because of Beijing's restriction on virtual currency mining, many crypto miners have migrated to Kazakhstan.
Over Beijing's ban on virtual currency mining, many crypto miners have fled to neighbouring Kazakhstan.
In a report Thursday, Marcus Sotiriou, analyst at U.K.-based digital asset broker GlobalBlock, said that Bitcoin's computing power "is not directly tied to the price of Bitcoin, but it gives an indication of the network's security, so a dip can worry investors in the near term."