The price of Bitcoin has fallen to its lowest point since July last year, dipping toward the $43,000 (US$30,000) mark this week as economic fears spook the cryptocurrency and stock markets.

Bitcoin came down off its all-time high of around $91,000 (US$67,000) last November and has since struggled to stabilise in an environment of growing inflation which central banks have responded to by pulling back on pandemic-induced quantitative easing measures while raising interest rates.

A Wall Street sell-off this week, led by tumbling tech stocks, has accelerated Bitcoin’s fall as its price fell nearly 10 per cent overnight on Monday with other major crypto coins following suit.

Cryptocurrency analysts and market watchers are suggesting the correlation between crypto and mainstream market prices will continue for as long as investors retain their risk-off attitude.

Edward Moya, a senior analyst for currency trader Oanda, is optimistic the crypto crash has little to do with the underlying technology and future demand for the digital assets, according to CoinDesk.

“The long-term fundamentals remain in place for bitcoin, but a return to record highs will take a long time,” he said.

“Bitcoin will start to stabilise when the bloodbath on Wall Street ends and right now many investors are still in panic-selling mode."

Likewise the CEO of Galaxy Digital Holdings, Michael Novogratz, told investors this week that crypto would continue to trade alongside the tech-heavy Nasdaq for the time being, according to Bloomberg.

“My instinct is there’s some more damage to be done,” he said.

“And that [we] will trade in a very choppy, volatile and difficult market for at least the next few quarters before people are getting some sense that we’re at an equilibrium.”

All of the leading FAANG stocks – an acronym used to describe Meta (formerly Facebook), Apple, Amazon, Netflix and Alphabet’s Google – were down in Monday night’s trading session with Amazon taking the biggest hit and falling five per cent.

Meta and Netflix, meanwhile, continued price falls that were precipitated by the companies posting declines in user numbers earlier this year.

While it has shown a correlative relationship between US tech stocks and cryptocurrency, the sudden decline in crypto values has stressed parts of the broader crypto ecosystem as stablecoin TerraUSD (UST) lost its peg to the US dollar.

As the name suggests, stablecoins are designed to hold a specific value in order to provide investors with less volatile asset that is still interoperable with the rest of the crypto ecosystem.

UST is the designated stablecoin of the Terra blockchain.

By early Tuesday afternoon, UST was trading at 78 US cents, still below its target of US$1 but slightly bouncing back from its weekend low of 68 cents.

UST has de-pegged in the past, but never as severely as this week’s slip – as a result, the price of Terra’s native coin Luna has fallen 60 per cent.