Bitcoin, cryptocurrencies return to red with soaring UK inflation

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Bitcoin dropped below US$20,000 for the third time in a week on Thursday morning in Asia as news of record inflation in the U.K. and warnings of a recession hit crypto markets.

See related article: Crypto on a roller coaster as market braces for Fed guidance on rates

Fast facts

  • Bitcoin was trading down 3.5% in the past 24 hours but slightly rebounded to US$20,045 at press time, according to CoinMarketCap.
  • Ethereum was down 6.52% to change hands at US$1,051 at press time, while all non-stablecoin tokens in the crypto top 10 were down.
  • Recent data out of the U.K. shows inflation is running at a 40-year high of 9.1%, and is expected to hit 11% in October in the U.K.
  • As central banks begin to raise interest rates to combat rising inflation, the probability of a global recession has risen to 50%, according to Citigroup Inc.
  • The crypto market cap is down more than 70% from its all-time high in November, as rising inflation rates and growing fears of recession have led to investors taking money out of risk assets.
  • Bitcoin’s down trend is not pulling down the entire cryptocurrency market as it had been in recent days, with Polygon’s MATIC surging 14% and Uniswap’s UNI rising by 9%. 

See related article: Is Bitcoin really a hedge against inflation?

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