Bitcoin down more than 7%, near the $ 47,000 threshold

Bitcoin price extends the decline in December 2021 and breaks key technical levels.

That digital coin falls 7.2% to 47.321 USD, and broke the 200-day moving average (MA200). Ethereum – the second largest digital currency – and the Bloomberg Galaxy Crypto Index are also in the red, with both down 7%. Smaller tokens like Solana, Cardano, Polkadot, and Dogecoin also fell.

The slump could be accelerated as more than 165,000 merchants sold their cryptocurrencies or 524 million digital assets in the past 24 hours, according to data from cryptocurrency exchange Coinglass. Investors have been gradually pulling out of a number of highly speculative investments recently, fearing that monetary tightening around the world could have a negative impact.

Also, Bitcoin could become less attractive as a hedge against inflation if the Fed begins to contain inflation.

Matt Maley, Head of Market Strategies at Miller Tabak +, said institutional investors could be to blame.

If institutional investors join late, “their gains in cryptocurrencies won’t be that big, maybe losses,” said Maley. “As a result, they can reduce their crypto holdings and increase their weight in other assets such as stocks.”