It's down and out! Bitcoin is testing a key $40,000 support level after falling 42% from all-time highs

Bitcoin's decline was extended over the weekend, at one point approaching $40,000 to a near 3-month low and down roughly 42% from the all-time highs set last year. In addition to bitcoin, mainstream cryptocurrencies such as ethereum, Uniswap and coinancoin also took a beating.

There are signs that the Federal Reserve is poised to accelerate its exit from stimulus to curb persistently high inflation, actions that could lead to less liquidity in the financial system and thus depress speculative assets with high valuations.

Mike McGlone of Bloomberg Intelligence says $40,000 is a key technical support level for bitcoin. But he expects bitcoin to eventually raise its eyebrows as a benchmark collateral as the world becomes increasingly digital.