Dec. 4 (Reuters) - Bitcoin lost a fifth of its value on Saturday as a combination of profit-taking and macroeconomic concerns triggered sales worth nearly a billion dollars in cryptocurrencies.
Bitcoin was down 12% at 0920 GMT at $ 47,495. It fell as low as $ 41,967.5 during the session, bringing total losses for the day to 22%.
The extensive cryptocurrency sell-off also saw ether, the currency linked to the ethereum blockchain network, drop more than 10%.
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According to cryptocurrency data platform Coingecko, the market capitalization of the 11,392 coins it tracks fell almost 15% to $ 2.34 trillion. That value had briefly crossed $ 3 trillion last month, when bitcoin hit a record high of $ 69,000.
The drop follows a volatile week for financial markets. Global stocks and benchmark U.S. bond yields fell on Friday after data showed U.S. job growth slowed in November and the Omicron variant of the coronavirus kept investors nervous. read more
Justin d'Anethan, head of Hong Kong-based exchange sales at cryptocurrency exchange EQONEX, said that he had been watching the rise in leverage ratios in the cryptocurrency markets and how large holders had been moving their currencies from wallets to exchanges. The latter is usually a sign of intention to sell.
"The whales in the crypto space appear to have transferred coins to the trading venue, taking advantage of a bullish bias and leverage from retail traders, then pushing prices down," he said.
The sell-off also comes ahead of testimony from executives from eight major cryptocurrency companies, including Coinbase Global. (COIN.O) CFO Alesia Haas and FTX Trading CEO Sam Bankman-Fried speak to the US House of Representatives Committee on Financial Services on Dec. 8. read more
The hearing marks the first time that major players in the cryptocurrency markets will testify before US lawmakers, as lawmakers grapple with the implications of cryptocurrencies and how to better regulate them.
Last week, the U.S. Securities and Exchange Commission (SEC) rejected a second proposal for WisdomTree's spot bitcoin exchange-traded fund.
Data from another platform, Coinglass, showed that nearly $ 1 billion worth of cryptocurrency had been settled in the past 24 hours, with most of it being done on the Bitfinex digital exchange.
"If anything, this is the opportunity to buy the dip for many investors who previously might have felt like they lost the boat. We can see the strap bought at a premium, which suggests that people are preparing cash, within the crypto space, to do just that, "D'Anethan said, referring to the world's largest stablecoin of cryptocurrencies.
A drop in bitcoin funding rates, the cost of holding bitcoin through perpetual futures that peaked at 0.06% in October, also showed that traders had turned bearish.
The funding rate on cryptocurrency trading platform BitMEX fell to a negative 0.18% from levels of 0.01% for most of November.
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Reporting by Maria Ponnezhath in Bengaluru and Vidya Ranganathan in Singapore. Additional reporting by Megan Davies in New York Edited by Shri Navaratnam and Jane Merriman
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