Bitcoin’s value continued to decline on Tuesday, briefly dipping below $30,000. The digital coin was worth around $31,500 (nearly 30,000 euros) at around 7:30 a.m. Dutch time.
Cryptocurrencies have been falling for a few days now, due to interest rate fears among investors. Higher interest rates are generally unfavorable to stocks and other risky investments.
Bitcoin has lost around 6.5% of its value in the past 24 hours, according to CoinMarketCap, which tracks digital coin prices. In the past seven days, the value has plunged more than 18% to its lowest level since July last year. At the start of the year, one bitcoin was worth nearly $48,000. Ether, the second largest digital currency by market value, lost almost 17% last week.
The interest rate fears that have gripped the financial markets for some time are also affecting the value of cryptocurrencies. At a press conference last week, US Federal Reserve Chairman Jerome Powell assured central bank policymakers would do whatever it takes to rein in rising inflation. He also emphasized “acting quickly”, which is interpreted by investors as an announcement that interest rates could be raised again soon.