Black Monday hits Bitcoin and it loses almost 10 thousand dollars of value

Bitcoin, the most popular cryptocurrency on the market, has been promoted by entrepreneurs such as Elon Musk and governments such as El Salvador, where its use is legal. (Illustrative Image Infobae)

Black Monday, which originated in Japan, has hit markets and currencies around the world, including cryptocurrencies such as Bitcoin.

The main virtual currency on the world market started the day trading above $59,300 per unit, however, as the day progressed and the repercussions of the Asian market spread, the price of Bitcoin began to fall.

Thus, at 12:25 p.m. (UTC time) it recorded its lowest price of the day: $49,513.63 per unit, a drop of nearly $10,000, equivalent to 16.5%.

Although it has managed to recover its value above 50 thousand dollars, it still registers losses of around 10 percentage points per unit. This is the worst fall recorded by Bitcoin since the end of last February.

The “traditional” market also affected the exchange rate of cryptocurrencies (REUTERS/Florence Lo/Illustration/File Photo)

Japan’s stock market plunged 12.4 percent, the biggest since 1987, and has spread to Europe and Latin America. The fall follows the release of weak U.S. jobs data on Friday, which has raised concerns about the world’s largest economy.

According to Bloomberg, cryptocurrency-related stocks also fell. Coinbase Global Inc., the largest U.S. exchange, lost more than 20%, bitcoin proxy MicroStrategy Inc. plunged nearly 30%, and miners Marathon Digital Holdings Inc. and Riot Platforms Inc. sank 20% and 15%, respectively.

The declines come as stock market sell-offs intensify around the world, reflecting concerns about the economic outlook and doubts about whether heavy investment in artificial intelligence will match the enthusiasm around the technology. Meanwhile, geopolitical tensions are escalating in the Middle East, adding to investor jitters.

Bitcoin has been hit by a number of factors since it hit a record high of $73,798 in March. Among them is political instability in the United States, where crypto-friendly Republican Donald Trump and Democratic challenger Vice President Kamala Harris — who has yet to detail her stance on digital assets — are facing off in the presidential race.

Also looming over the market are potential sales of Bitcoin seized by governments and the risk of an oversupply of tokens returned to creditors through bankruptcy proceedings.

A worker helps a man with the use of bitcoin in front of an ATM of “Chivo”, the digital wallet backed by the Salvadoran government, in San Salvador, El Salvador, September 8, 2021. (REUTERS/Jose Cabezas)

Specialised portals are used to buy and exchange them. Their value varies depending on supply, demand and user commitment, so they can change faster than traditional money, but the more people are interested and want to buy a certain currency, the higher its value will be.

However, anyone who invests in this type of digital assets must be very aware that this method entails a high risk to capital, since, just as there may be an increase, there may also be an unexpected collapse and wipe out the savings of its users.

To store them, users must have a digital wallet, which is actually a software through which it is possible to store, send and make transactions with cryptocurrencies. In reality, this type of wallet only stores the keys that mark the ownership and rights of a person over a certain cryptocurrency, so these codes are the ones that really need to be protected.