Bitcoin Falls Under $83,000 on Oil Spike, Rising US Borrowing Costs

Bitcoin’s price has plunged — with other assets — as oil surges and the cost of borrowing increases. 

The largest cryptocurrency was trading for $83,062, down nearly 4% over a 24-hour period Wednesday morning in New York, after at one point dropping as low as $82,823. Last week, the coin nearly touched as high as $87,086. 

Over the past 24 hours, nearly $178 million in long bets on the bitcoin price have been closed, according to Coinglass. 

Bitcoin’s sharp drop comes as U.S. mortgage rates climb for a seventh straight week to their highest level in nearly three years. 

The rise in borrowing costs was prompted by the oil price surging, stoking fears that the Federal Reserve will hike rates again. The U.S. central bank last month hiked interest rates. 

Bitcoin’s price has in the past done well in a low interest rate environment and been sensitive — at least in the short-term — when the Federal Reserve has threatened to raise borrowing costs. 

Brent crude jumped above $102 after Iran stepped up attacks on vessels in the Strait of Hormuz. 

The price of various assets took a hit on Wednesday, with gold, silver, and stocks also dipping on the news. 

The price of oil rising is stoking what many politicians are calling an affordability crisis in the U.S. Americans will go to the polls on November 3, and surging inflation is one of the hottest topics. 

Despite the price of bitcoin dipping Wednesday, the asset just had its best quarter in years, and analysts have said the coin is now in a bull market after rising above its 365-day moving average. 

The biggest digital asset last month shrugged off the Federal Reserve raising interest rates and lawmakers blocking landmark crypto legislation, the Clarity Act.