Panic as bitcoin collapses, transactions suspended on major exchanges

It’s dark times for bitcoin traders as the token continues to slip to levels so low two crypto exchanges paused all transactions in a scramble to survive.

Bitcoin has continued to slide to levels so low they haven’t been since the early days of the pandemic as panic takes hold among traders.

Early on Tuesday morning AEST, the coin hit a nearly two-year low at US$22,601. Then in the afternoon, that price dipped again, to US$20,834.50.

Overall, that represented a drop of more than 15 per cent in just 24 hours.

Ethereum didn’t fare much better, suffering a 16 per cent fall to come to US$1,075 at its lowest point over the last day.

It’s a far cry from the coin’s all-time highs in November last year; Bitcoin was worth almost US$69,000 a piece while ether was US$4,865 at its peak, 70 per cent more than it is worth now.

In total, cryptocurrency’s total market cap has dipped below US$1 trillion and was resting at US$969 billion at 8am.

The bitcoin bear run was so extreme that two major crypto exchanges suspended trading transactions — one of which has done so indefinitely.

Binance temporarily suspended bitcoin withdrawals which meant nobody could cash out their funds.

Meanwhile, cryptocurrency lending platform The Celsius Network paused all withdrawals because of “extreme market conditions”, impacting its estimated 1.7 million users.

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.@CelsiusNetwork is pausing all withdrawals, Swap, and transfers between accounts. Acting in the interest of our community is our top priority. Our operations continue and we will continue to share information with the community. More here: https://t.co/CvjORUICs2

— Celsius (@CelsiusNetwork) June 13, 2022

Bitcoin is in free fall, prompting drastic measures from crypto exchanges.

UK-based Celsius pays interest on cryptocurrency deposits, loans them out and also sells its own token, CEL, but it ceased all activities around midday on Tuesday.

In a blogpost the company warned it was “pausing” all withdrawals and transfers between accounts, adding: “Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, swap, and transfers between accounts.

“We are taking this action today to put Celsius in a better position to honour, over time, its withdrawal obligations.”

Although the Celsius freeze on bitcoin has lasted for more than 12 hours and is still going, Binance’s bitcoin trading function was back up and running after less than three hours.

Post mortem of our temporary BTC network withdrawal suspension.

🔸 Temporary pause duration: ~3 hours
🔸 Impact: $BTC network withdrawals only. Users could still withdraw #Bitcoin on other networks without delay (ERC20 & BEP20). Deposits unaffected.

🧵More details 👇

— Binance (@binance) June 13, 2022

Cryptocurrency has been facing a reckoning in recent weeks – and particularly the last few days – as fears mount over a global recession amid rampant inflation and the US central bank hiking interest rates.

On Friday, data found the USA’s inflation rate had reached a new high — rising to 8.6 per cent in May, the worst its been since 1981.

Over the weekend, cryptocurrency plunged in reaction to the news.

This Wednesday, the US Federal Reserve is expected to raise its interest rate to combat spiking inflation.

Economists predict the rate will be increased to settle on 0.25 per cent or 1.50 per cent for July, with the central bank doing a similar thing last month.

Cryptocurrency is closely aligned with the traditional stock market and over the last few days, markets like Dow Jones have tanked and entered a bear run.

Originally published as Panic as bitcoin collapses, transactions suspended on major exchanges