- Bitcoin on Friday dropped below $20,000 for the first time in two months.
- The crypto industry is navigating through fresh pain as Silvergate Bank prepares to wind down.
Bitcoin slumped to its lowest price in two months Friday as the collapse of crypto depositor Silvergate Bank and the blow-up of tech startup lender Silicon Valley Bank fueled a retreat by investors from so-called risk assets.
$4 was down almost 8% Friday morning and fell below $20,000 for the first time since mid-January. At its weakest point in the session, the digital coin hit $19,594, the lowest price since January 13. $4 also fell, down more than 7% to trade around $1,415.80
Bitcoin was veering toward a weekly loss of 10% in the face of the pending closure of Silvergate Bank, one of just a handful of US banks that accepted crypto deposits. $4 said Wednesday it would start an $4 and voluntary liquidation of Silvergate Bank in light of industry and regulatory developments.
Customers$4 since crypto exchange FTX failed in November. Meanwhile, a drop in crypto prices as the Federal Reserve kicked up interest rates to tame hot inflation also Silvergate.
"[We] see investors and traders pulling their money, and the institutions have little to no mechanism to stop that. The adverse effect of this event negatively influences the price of bitcoin," Naeem Aslam, chief investment officer at Zaye Capital Markets, wrote in a Friday note.
"But we are still surprised that the price of bitcoin hasn't fallen as sharply as many had expected, especially [as] Silvergate was one of the most important banks for crypto operations."
Risk appetite was also hit Friday by a plunge in shares of $4 The stock sank more than 60%, extending a Thursday selloff on contagion worries in the banking industry.
A key lender to technology startups, Silicon Valley Bank this week said the climb in interest rates $4 on a $21 billion bond portfolio. $4 on Friday the company is in talks to sell itself after attempts to raise capital fell short.
The $4 fell more than 2% on Friday. A selloff in bank stocks Thursday $4 of market value in $4, $4, $4 and $4, four of the largest banks in the US.
Morgan Stanley, BofA and Wells Fargo shares were lower during Friday's session while JPMorgan stock edged up.