Crypto market caps dips below $1 trillion for first time since early 2021

Yahoo Finance reporter David Hollerith joins Yahoo Finance Live to discuss the crypto market sell-off and Bitcoin falling below $23,000.

Video transcript

AKIKO FUJITA: Worth noting what's happening in crypto today. I wonder if we can pull that up here because we have seen big declines in Bitcoin, falling-- where is the level right now?

BRIAN CHEUNG: Yeah, I believe it was close to about 23,000. Again, I'm trying to-- right, yeah, it's about 22.9 right now.

AKIKO FUJITA: There you go, it's below 23,000, so down about 17% there. Joining us for more on the crypto action, let's bring in Yahoo Finance's David Hollerith. David.

DAVID HOLLERITH: Akiko, it's obviously been a tough weekend for the crypto market and crypto investors. The macro picture is actually not changed that much following the release of CPI data on Friday. Cryptocurrencies traded lower over the weekend. But what we saw over the weekend is a little bit of inside the cryptocurrency sector, there's been a little bit of risk of liquidations and/or insolvency with companies.

One of the big areas that are being paid attention to right now by investors are crypto lenders. The Celsius Network, one of the largest crypto lenders, announced last night that they would pause withdrawals for clients, which essentially means they can't redeem anything. The big worry here is that in Celsius's terms and conditions, investors cannot necessarily have their assets redeemed if Celsius undergoes any kind of bankruptcy or has some other situation where it can't meet obligations.

Now, Celsius hasn't gotten back to us about what the actual state of their financials are, but it is a worrying situation. And obviously, there are other crypto lenders out there. So there is definitely a risk of contagion. Now, Bitcoin is-- now that we're seeing it's below $23,000, and analysts this morning have said that there's support around the $22,500 range. Obviously, we could see those levels. After that, there's a little bit less buyer support in between there and about $18,000. So, obviously, investors are watching this pretty closely. And, you know, I think that at this point, it's anybody's call where the bottom is.

BRIAN CHEUNG: Right, and we're still watching, by the way, Binance, that platform saying that they're actually suspending Bitcoin network withdrawals. It's only affecting Bitcoin apparently. They had said that they were working on it and were hoping to get that temporarily fixed, but no updates from Binance just yet. We'll continue to update on that front. Yahoo Finance's David Hollerith, thanks so much for the breakdown.