Representation of Ethereum, with its native cryptocurrency ether.
Dado Ruvic | Reuters
Ether fell as much as 9% on Monday, slipping below its critical $3,600 support level, shortly after a multimillion dollar hack affected a protocol on the token’s native network.
The cryptocurrency, which is issued on Ethereum, was last down 6.6% at around $3,600, CoinMetrics data shows. That’s roughly 25% off its high of $4,885 hit on August 22.
The coin’s tumble came after Ethereum-based decentralized finance protocol Balancer on Monday lost possibly more than $100 million in a hack. The exploit marks the latest in a series of bearish events that have put digital assets investors on tenterhooks over the past few weeks.
In mid-October, U.S. President Donald Trump announced “massive” tariffs on China over its restriction of rare earth exports, kicking off investors’ flight from crypto to risk-off assets such as gold. And although the president later walked back that threat, his comments sparked a sell-off that triggered cascading liquidations of highly leveraged digital asset positions.
Last week, Federal Reserve Chair Jerome Powell cautioned investors about expecting future rate cuts, adding to existing bearish market sentiment.
“These events have put investors on uneasy footing as we roll into November,” Juan Leon, senior investment strategist at Bitwise, told CNBC. “Macro volatility notwithstanding, this October’s drawdown appears to have been a healthy, albeit sharp, de-leveraging event that flushed speculative excess from the market.”
Some stocks linked to digital assets are also coming under pressure. Coinbase shares were down nearly 4%, while Bitcoin treasury firm Strategy edged down more than 1%.