The 60 %slide from Voyager Digital leads the sale for crypto shares

The 60 %slide from Voyager Digital leads the sale for crypto shares

crypto -related shares fell on Wednesday - together with the wider market - since investors continue to analyze the infection risks through the liquidity crisis of the credit company Celsius.

"Unfortunately, crypto shares are punished if either crypto or technology or both are out," said David Tawil, President and co-founder of Prochain Capital. "However, I assume that the same will ultimately apply upwards ... If we have reached or reach a low point at Krypto and/or shares, I think that this is a good starting point."

crypto-broker voyager digital led the decline and lost up to 60 %during the trading session on Wednesday, after it became known that the company in the potentially insolvent hedge Capital was invested.

According to Voyager, Three Arrows currently has an outstanding loan of around $ 657 million, and the broker can arrange for a delay in payment if the full amount is not paid by June 27.

"This new unveiling could make some investors ask whether these unscrupulous business practices between lender and borrower are common in the industry, although further problems still have to be announced," said Josh Olszewicz, head of research at the crypto fund manager Valkyrie Investments. "Several crypto creditors who have reported liquidity problems in the past few weeks have also sparked fear on the market and led to a general decline in the available loans."

Exchange Coinbase, the business intelligence company Microstrategy and the digital-asset mining company Marathon Digital also recorded losses on Wednesday. Coinbase temporarily lost 7 %, while Microstrategy, which has been in the downward trend for several months, lost up to 8.5 %.

The sale takes place when the markets react to the statement by the chairman of the US Federal Reserve, Jerome Powell, ahead of the US Senate banking committee on Wednesday. If interest rates rise too quickly at a steep pace, senators could warn, a recession could result.

"It is certainly a way, it is not our intended result at all," said Powell. "We don't try to provoke a recession, and I don't think we have to provoke a recession."

The market turbulence is expected to not subside until a change in monetary policy occurs, analysts said.

"Legal recovery on the stock markets will still remain on Wall Street until the economic data is dramatically weakening and the FED swings so that it can loosen her tightening of the monetary policy strategy," said Edward Moya, Senior Market Analyst at Oanda.

In particular for crypto -related stocks, Tawil added that the fear of infection had to be reduced primarily.

"The market must definitely see at least one week without further explosions or cracks to explain that the infection is over," said Tawil. "The debt reduction continues and there will continue to be weaknesses in companies with remaining stability issues, but the forced sale for this round will be ended."

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The contribution Voyager Digital’s 60% Slide Leads the Sell-Off for Crypto Equities is not a financial advice.