Investors unnerved by the financial strains of a Chinese real estate firm sent cryptocurrencies reeling on Monday, with bitcoin (BTC-USD) tumbling by more than 7%.
As risk-sensitive assets plunged, the leading digital coin shed over $3,000, changing hands just below $44,000 in midday trading. The moves were the latest signal that the world’s largest cryptocurrency hasn’t achieved the “safe haven” asset status that some of its more ardent proponents have promoted, even as debt levels around the world surge in response to COVID-19.
With the virus still dominating investor concerns, markets were jolted by news of Evergrande, a major Chinese real estate company that’s teetering on the brink of default. China’s potentially slowing economy, and Beijing’s aggressive actions against key business sectors, have converged with worries about the global economy. Meanwhile, a fight is brewing in Washington over raising the U.S. debt limit.
The spillover effects were apparent across the crypto world. According to CoinmarketCap, top payment networks such as Ethereum (ETH-USD), Cardano (ADA-USD), Binance Coin (BNB-USD) and Solana (SOL1-USD) have all sustained even deeper losses than bitcoin in the past 24 hours: all were off by at least 8% on the day.