Major Cryptos Dive: Bitcoin and Ethereum Hit New Lows Amidst Billions in Firm Losses
Major Cryptos Dive: Bitcoin and Ethereum Hit New Lows Amidst Billions in Firm Losses
The cryptocurrency market is experiencing a significant downturn, with major assets like Bitcoin, Ethereum, and Solana seeing steep declines. Publicly traded crypto treasury firms are reporting billions in unrealized losses, leading some to be 'underwater' on their holdings. Bitcoin miners, in particular, face a potential crisis as BTC's price falls close to their average production costs, with analysts predicting further drops. Ethereum-focused firms are also recording substantial paper losses, signaling a challenging period for the sector.
Crypto Market Plunges: Bitcoin and Ethereum Lead the Downturn
The cryptocurrency market is currently grappling with a severe downturn, as prominent assets like Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) have experienced significant price dives. This market contraction has left numerous publicly traded crypto treasury firms deeply "underwater" on their holdings, impacting their financial stability.
Billions in Losses for Crypto Firms
A prime example of the recent struggles is a leading Bitcoin treasury firm, which recorded a staggering $12.4 billion Q4 loss, sending its shares to an 18-month low. This follows widespread hits taken by the firm in recent months, despite its CEO referring to it as a "digital fortress." Similarly, publicly traded firms focused on Ethereum have seen their shares plummet to seven-month lows, with one firm alone reporting unrealized paper losses reaching $8 billion.
Bitcoin Miners Face Crisis as Prices Near Production Costs
The downturn has hit Bitcoin miners particularly hard. With BTC's price crashing below $63,000, it is now hovering precariously close to the average production cost for many publicly traded mining operations. This dramatic fall, over 50% from its peak, has ignited fears of a potential crisis within the mining sector. Analysts are cautioning that the crash could deepen further, with some predicting a potential slide to $38,000 if historical patterns repeat, raising questions about how low Bitcoin and Ethereum prices might eventually go.