Luno, a global cryptocurrency company, has linked the drop in bitcoin price last week to negative sentiments which affected all asset classes.
While reacting to the 18 per cent drop in the price of bitcoin on Tuesday, September 24, Luno noted that it was the largest intraday drop in the cryptocurrency’s price since January 2018.
However, Luno said the price of bitcoin had stabilised but the size of the drop sent shock waves through cryptocurrency exchanges across the world.
The General Manager for Africa at Luno, Marius Reitz, said the price drop in cryptocurrency could be because of the negative sentiment across all markets caused by the global political news.
He said this had impacted all asset classes at a time of low liquidity, which had led to volatility.
He explained that whenever there was more liquidity, more money would be invested in safe haven assets, gold and yen, among others.