Bitcoin surrenders weekend gains, slides 5 per cent

Cryptocurrencies continued their steady decline on May 16, surrendering the gains made over the weekend as regulators loomed.

European authorities have reinforced their warnings about the vulnerabilities of cryptocurrencies. Bitcoin slumped 5 per cent to roughly $29,700 in Asian trade on Monday, falling alongside markets amid concerns about burgeoning inflation and borrowing costs.

As the catastrophic collapse of TerraUSD, a so-called stablecoin, has roiled crypto markets already plunging amid widespread selling of risky assets, the world’s largest cryptocurrency has lost almost a fifth of its value so far this month.

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Stablecoins are vulnerable to investor runs, according to the US Federal Reserve, because they are underpinned by commodities that could depreciate or become worthless in adverse economic conditions.