Most cryptocurrencies tumbled on Thursday, with Bitcoin, world’s largest virtual currency by market capitalization, falling below $37,000 amid expectations of tightening monetary policy in the US.

Bitcoin fell 4.46 percent to $36,869.16 at 9:20 am (IST), after breaching the $39,000 level for the first time in two weeks on Tuesday (February 1), according to CoinDesk data. The cryptocurrency had traded at nearly $47,000 level on January 3.

Bitcoin, which had hit an all-time high of near $69,000 hit in November 2021, shed over 20 percent in 2022.

Second-largest cryptocurrency Ether, which is linked to ethereum blockchain, also plunged more than 4 percent to $2,656.26, as per CoinDesk.

Solana, which witnessed substantial interest from the crypto traders last year, fell nearly 12 percent to trade at $97.86 at 9:33 am.

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Meme crypto Dogecoin also fell nearly 4 percent to $0.14 whereas Shiba Inu, which has fallen constantly since October 28, was trading more than 5 percent lower at $0.000021.

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Other cryptocurrencies such as Litcoin, Cosmos, Stellar, XRP, Chainlink, Avalanche, Cardano, Polygon, Terra, prices were trading in the red over the past 24 hours.

Meanwhile, finance minister Nirmala Sitharaman in the Union Budget announced 30 percent tax on the returns from trading or investing in cryptocurrencies or other digital assets such as NFTs.

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Finance Secretary TV Somanathan on Wednesday said India's digital currency will be backed by the Reserve Bank of India (RBI), and cryptos will never become a legal tender.

“Digital currency will be backed by RBI which will never be default. Money will be of RBI but the nature will be digital. Digital rupee issued by RBI will be a legal tender. Rest all aren't legal tender,will not,will never become legal tender: Finance Secy TV Somanathan,” ANI tweeted.

Digital currency will be backed by RBI which will never be default. Money will be of RBI but the nature will be digital. Digital rupee issued by RBI will be a legal tender. Rest all aren't legal tender,will not,will never become legal tender:Finance Secy TV Somanathan

(File pic) pic.twitter.com/Cko0e4753X— ANI (@ANI) February 2, 2022

Somanathan said that Bitcoin, Ethereum, or any NFT will never become a legal tender. Sitharaman also emphasised in the Budget that only RBI-backed digital currency can be legal tender.

(Edited by : Bivekananda Biswas)

First Published:Feb 3, 2022 11:00 AM IST