Bitcoin plunged to near $30,000 at one point on Wednesday morning, continuing a major sell-off in the cryptocurrency markets that began a week ago.
The digital currency was down about 13% for the day shortly before noon ET at $37,490, according to Coin Metrics. It hit as low as $30,001.51 as the selling intensified Wednesday morning before paring some of those losses. The cryptocurrency hasn’t traded below $30,000 since late January.
At its intraday low, bitcoin’s loss for the past week was more than 40%.
That means bitcoin has now erased all its gains following Tesla’s announcement that it would purchase $1.5 billion worth of the cryptocurrency. It’s also down more than 50% since hitting a record high of $64,829 in mid-April.
Other cryptocurrencies also plunged on Wednesday. Ether, the digital currency that powers the Ethereum blockchain, was down more than 20% at $2,699, according to Coin Metrics. Dogecoin, a cryptocurrency that started as a joke and has been talked up by Musk, fell more than 18% to about 39 cents.
Additionally, cryptocurrency exchange Coinbase was temporarily down for some users as the coins plunged on Monday morning.
Bitcoin prices fell sharply amid the global sell-off in equities.
Luke MacGregor | Bloomberg | Getty Images
The announcement to suspend bitcoin payments came just three months after Tesla revealed that it bought $1.5 billion worth of bitcoin, and would start accepting bitcoin in exchange for its products.
Then on Tuesday, three Chinese banking and payment industry bodies issued a statement warning financial institutions not to conduct virtual currency related business, including trading or exchanging fiat currency for cryptocurrency.
China’s hard line on digital currencies is not new. In 2017, authorities shut down local cryptocurrency exchanges and banned so-called initial coin offerings (ICOs), a way for companies in the space to raise money through issuing new digital tokens.
Traders in China once accounted for a huge share of the bitcoin market but after the crackdown, their influence was reduced significantly. Chinese cryptocurrency operations have moved abroad.
“The crypto markets are currently processing a cascade of news that fuel the bear case for price development,” said Ulrik Lykke, executive director at crypto hedge fund ARK36.
More than $250 billion evaporated from the bitcoin market alone last week, Lykke said. Though that number seems “astronomical,” such moves aren’t uncommon in the volatile crypto market, he added.
“In terms of Bitcoin’s outlook, things may be looking grim right now, but historically this is just yet another hurdle for Bitcoin to overcome and a small one compared to what it has braved in the past,” said Lykke.
Bitcoin is still up over 30% year-to-date and around 300% in the last 12 months.