Representation of Ethereum with its native cryptocurrency Ether.
Given Ruvic | Reuters
ether fell as much as 9% on Monday, slipping below its critical support level of $3,600, shortly after a multimillion-dollar hack compromised a protocol on the token's native network.
The cryptocurrency, issued on Ethereum, was last down 6.6% at around $3,600, data from CoinMetrics shows. That's about 25% lower than the August 22 high of $4,885.
The coin's crash came after Ethereum-based decentralized finance protocol Balancer potentially lost more than $100 million in a hack on Monday. The exploit is the latest in a series of bearish events that have kept digital asset investors on edge in recent weeks.
In mid-October, US President Donald Trump announced “massive” tariffs against China over its export restrictions on rare earths, triggering a flight of cryptocurrency investors to risk-averse assets like gold. And although the president later walked back that threat, his comments triggered a sell-off that triggered a cascading liquidation of highly leveraged positions in digital assets.
Last week, Federal Reserve Chairman Jerome Powell warned investors not to expect future interest rate cuts, adding to existing bearish market sentiment.
“These events made investors uneasy as we entered November,” Juan Leon, chief investment strategist at Bitwise, told CNBC. “Despite the macroeconomic volatility, October’s decline appears to have been a healthy, albeit strong, deleveraging event that drove speculative surpluses out of the market.”
Some stocks linked to digital assets are also coming under pressure. Coinbase Shares fell nearly 4% while Bitcoin finance company strategy decreased by more than 1%.