Crypto On Jan. 7: Bitcoin Falls Below $42K Mark; Triggers Market Crash

Bitcoin tumbled below the $42K mark early Friday morning adding to the woes of the broader market already dented by concerns about faster interest rate hikes.

Following the bloodbath in top cryptocurrencies, the global market cap fell below the $2 trillion mark and stood at $1.97 trillion at 3.01 a.m. ET after a 4.26% fall.

Bitcoin fell 3.40% and was trading at $41,583, Coinmarketcap data showed. This was unexpected for many, although there are analysts who believe that the top coin would continue to tumble and can touch $20K in a year or two.

Ethereum, too, fell 7.55% and was trading at $3,194. Solana saw a similar downward trend.

Among other top coins, all cryptos traded in the red barring a slight uptick in Tether. Meme cryptos Shiba Inu and Dogecoin continued to slide.

Experts believe that while there could be multiple reasons for the market crash, the Federal Reserve's minutes reveal did have a significant impact.

“This situation may be due to the speculations around regulations, inflation and fear of the new COVID variant. But this might also be a good opportunity for enthusiastic investors to actively take advantage,” Edul Patel, CEO and co-founder of crypto investment firm Mudrex, told Gadgets 360.

Meanwhile, reports indicate that crimes involving cryptocurrencies rose to a record high last year in terms of value. In 2021, illegal addresses received $14 billion in digital currencies, equivalent to a 79% rise from the record $7.8 billion in 2020.

The crypto market is extremely volatile and experts recommend investors not make decisions based on the sudden shift in prices.