The cryptocurrency market plunged a whopping 9.27% in the last 24 hours of trading. The slowdown was first sparked by the minutes of the US Federal Reserve meeting which showed the bank is considering cutting its $ 8.3 trillion (£ 6.12 trillion) balance sheet.
The fear and greed index, which tracks sentiment among cryptocurrency market participants, pegged the current mood at 15. (1 shows extreme fear and 100 extreme greed). Extreme fear among market participants is at its highest since July 21, 2020. The index takes into account volatility, market volume, social media, dominance, and trends.
Bitcoin sank to $ 42,000 ($ 43,000 levels in London mid-morning) and was trading 32% below its all-time high recorded last November.
The current recession also means there is £ 1 trillion less in total market value since the all-time high. The total market capitalization is currently $ 2.03 trillion, according to the website CoinMarketCap.com.
Other news about cryptocurrencies:
- Non-fungible token platform OpenSea raised $ 300 million (£ 221.23 million) in a Series C funding round as the platform seeks to become a central destination for the technology.
- BTCS Inc, which is listed on Nasdaq, a company focused on blockchain technology, said it will pay dividends in bitcoin as the first company to go public on the stock exchange.
Rounding of currencies by market capitalization
At 10:30 GMT:
Read more: Cryptocurrency markets tumble as Fed considers cutting balance sheet
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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you do not own the underlying asset when you trade a CFD.
You can still profit if the market moves in your favor, or lose if it moves against you. However, with traditional trading, you sign a contract to exchange legal ownership of individual stocks or commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the total value of the CFD trade to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to maintain trades (unless you use 1-1 leverage), making them more suitable for short-term trading opportunities. Typically, stocks and commodities are bought and held longer. You can also pay commission or broker fees when buying and selling assets outright and you would need a place to store them safely.
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