Bitcoin briefly drops below $20,000 to lowest level since mid-July as investors dump risk assets

Bitcoin briefly dropped below $20,000 on Monday as investors dumped risk assets after the Federal Reserve affirmed its commitment to an aggressive tightening path.

The world’s largest digital currency tumbled 5% from Friday’s close to hit an intraday low of $19,526 overnight, a level unseen since July 13, according to Coin Metrics data. Other major digital tokens also sold off, with ether falling to $1,423, its lowest level in a month. Bitcoin last traded at $20,266 apiece.

The sharp decline in cryptocurrencies coincided with a big sell-off in U.S. stocks, triggered by Fed Chairman Jerome Powell’s a stern commitment to halting inflation in a speech in Jackson Hole, Wyoming. The Dow Jones Industrial Average shed 1,000 points Friday after Powell said he expects the central bank to continue raising interest rates in a way that will cause “some pain” to the U.S. economy. Stocks sold off again on Monday.

“Bitcoin weakened after Fed Chair Powell didn’t blink with his reiteration that the Fed will tighten policy to bring down inflation,” said Edward Moya, senior market analyst at Oanda. “Risky assets are struggling as Powell’s fight against inflation will remain aggressive even as it will trigger an economic slowdown.”

Bitcoin declined more than 3% last week for its third negative week in four. The cryptocurrency is down over 50% this year and remains 70% off of its all-time high price of $68,990.90 hit in November.

The crypto market has been plagued by a number of issues including the collapse of algorithmic stablecoin terraUSD, which sparked a chain of events that led to the bankruptcy of lending platform Celsius and hedge fund Three Arrows Capital.