Why is Crypto falling sharply?

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Cryptocurrency prices fell sharply on Monday, extending losses from last week as fears of tighter monetary policy and a regulatory clampdown spooked investors, while major tokens such as Bitcoin and Ether remained above key support levels.

Bitcoin dropped 4.3% to $23,000 by 08:38 ET (12:38 GMT). The world's largest cryptocurrency slipped below the $23,000 level last week for the first time since Feb. 24.

Ether fell 3.6% to $1,600, but remained above the $1,500 support level.

Other major cryptocurrencies also fell, with XRP down 6.5%, BNB slipped 3.2%, and ADA declined 4.1%.

Dogecoin fell 3.2%, while Litecoin slipped 3.6%.

Shiba Inu slid 7.1%, and Tron dropped 6.2%.

Cryptocurrency prices largely tracked losses in the stock market, with the三大股指 opened lower on Monday over fears that recent upbeat economic data could lead the Federal Reserve to keep hiking interest rates for longer than expected.

However, crypto markets remained relatively stable compared to wild price swings seen in 2022, when several high-profile bankruptcies and blowups rocked the industry.

Last week, Genesis Global Holdco filed for Chapter 11 bankruptcy protection, becoming the latest crypto firm to collapse after the spectacular failure of exchange FTX in November.

Genesis, owned by Digital Currency Group (DCG), had disclosed more than $3 billion in liabilities in court filings. It had to halt withdrawals in November as the FTX contagion spread through the crypto sector.

The bankruptcy filing comes amid a months-long legal battle between Genesis' parent company and crypto exchange FTX, which both belonged to Sam Bankman-Fried's network of companies before FTX filed for bankruptcy last year.

Genesis had earlier accused FTX and Alameda Research, a trading firm also founded by Bankman-Fried, of owing it more than $10 billion, while FTX has claimed Genesis owes it money.

After FTX's collapse, several crypto exchanges, including Binance, announced "proof-of-reserves" to reassure customers that their assets are safe. However, critics argue that these attestations are insufficient and do not provide a complete picture of an exchange's financial health.

In a bid to boost transparency, crypto exchange Coinbase said on Monday it will launch a new service that will allow users to independently verify their on-chain cryptocurrency balances.

Coinbase users will be able to generate a Merkle tree proof, which cryptographically links their individual exchange wallet to the exchange's total reserves, the company said in a blog post.

The service, called "Coinbase attest," will initially be available for bitcoin, ether, litecoin and XRP, and will be rolled out to other assets over time, Coinbase said.