For the first time since December 2020, Bitcoin fell 6.98% in value thus dropping below the $20,000 mark, as shown by trading data on Saturday. At 07:00GMT on Saturday, Bitcoin hit $19,487 as shown on the largest cryptocurrency exchange platform, Binance.

CoinMarketCap, a portal that calculates the average of over 20 exchanges, the price of Bitcoin sunk to $19,554, falling by 6.50%.

Earlier in May, Bitcoin’s price fell by almost 50 percent from its November record high as the value of most risky assets dropped, on May 9th, due to fears that the Federal Reserve could send the US economy into recession by embarking on the highest rate hike in three decades.

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Furthermore, Ethereum and other cryptocurrencies also crashed earlier this month in parallel to the stock crash and global economic recession. 

Ethereum, the second most valuable cryptocurrency in the market, experienced a brutal drop following Bitcoin’s crash. The currency’s value sank by 15% in two days after an aggressive sell-off by investors.

Ethereum is now valued at a low of $996.88, which is the lowest it has gotten since March 2021. The cryptocurrency peaked at $4,878 which meant that the drop in value with respect to the highest value reached is approximately 94.8%. 

Previously this month, the Federal Reserve increased its target interest rate by three-quarters of a percentage point and estimated a slowing economy and more unemployment in the coming months.

"The Committee decided to raise the target range for the federal funds rate to 1-1/2 to 1-3/4 percent and anticipates that ongoing increases in the target range will be appropriate," the central bank’s Federal Open Market Committee (FOMC) said in a statement on its monthly rate decision for June.
 
The rate hike was the biggest since 1994, and US central bank officials warned of a faster rate hike in the future.

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