Cryptocurrencies were exposed to the liquidity crisis which is typical of the crypto space, it led to a drastic fall in the price of crypto even before the Fed’s rate hike on Wednesday. Once again, it was caused by the liquidation of large positions owned by Three Arrows Capital, a notorious crypto hedge fund, resulting in the outbreak of contagion across several DeFi platforms. Things were looking bad last Monday, even before the U.S. markets started trading.
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