عربي English Türkçe اردو فارسى
Logo
Latest News
Business

Bitcoin Drops to New Two-month Low as World Markets Sell Off

File photo: Physical imitation of Bitcoins are pictured at a cryptocurrency exchange branch near the Grand Bazaar in Istanbul on October 20, 2021, a day after Bitcoin took another step closer to mainstream investing with the launch of a new security on Wall Street tied to futures of the cryptocurrency. Ozan Koze, AFP archive
File photo: Physical imitation of Bitcoins are pictured at a cryptocurrency exchange branch near the Grand Bazaar in Istanbul on October 20, 2021, a day after Bitcoin took another step closer to mainstream investing with the launch of a new security on Wall Street tied to futures of the cryptocurrency. Ozan Koze, AFP archive
TT
TT

Bitcoin Drops to New Two-month Low as World Markets Sell Off

File photo: Physical imitation of Bitcoins are pictured at a cryptocurrency exchange branch near the Grand Bazaar in Istanbul on October 20, 2021, a day after Bitcoin took another step closer to mainstream investing with the launch of a new security on Wall Street tied to futures of the cryptocurrency. Ozan Koze, AFP archive
File photo: Physical imitation of Bitcoins are pictured at a cryptocurrency exchange branch near the Grand Bazaar in Istanbul on October 20, 2021, a day after Bitcoin took another step closer to mainstream investing with the launch of a new security on Wall Street tied to futures of the cryptocurrency. Ozan Koze, AFP archive

Top cryptocurrency bitcoin hit a fresh two-month low on Friday, breaking out of its recent tight range as a wave of risk averse sentiment swept through world markets.
On Thursday, bitcoin fell 7.2% in its biggest one-day drop since November 2022 when top exchange FTX collapsed.
It then slipped to a two-month low of $26,172 during Asian trading hours on Friday, its lowest since June 16. By 0835 GMT, it had partly recovered to $26,441, down 0.8% on the day, Reuters said.
Global markets have been hit by a wave of selling, with Wall Street's main indexes closing lower on Thursday and Asian shares heading for a third week of losses over concerns about China's economy and fears that US interest rates would stay higher for longer given a resilient economy.
Ether, the second biggest cryptocurrency, was steady at $1,685.20, having also dropped sharply on Thursday.
Some analysts attributed crypto's drop to a Wall Street Journal report that Elon Musk's SpaceX sold its bitcoin holdings after writing the value down by $373 million. Musk is influential among crypto enthusiasts, and bitcoin prices have previously moved in response to his tweets.
The SpaceX report was the "immediate catalyst" for bitcoin's sell-off, said Ben Laidler, global markets strategist at eToro.
"The broader driver is that crypto assets are not immune to the deepening risk-off selling pressure seen across all asset classes," Laidler added.
Joseph Edwards, head of research at Enigma Securities, attributed the bitcoin price move to low volatility and a lack of enthusiasm from retail investors.
Bitcoin had been hovering close to $30,000 in recent months, having gradually recovered this year after dropping sharply in 2022 when various crypto firms collapsed, leaving investors with large losses.
Crypto markets were boosted in June by BlackRock applying to launch a spot bitcoin exchange-traded fund (ETF) in the United States. Some investors interpreted that move as an indication that the US Securities and Exchange Commission would approve spot bitcoin ETF applications from various asset managers, including Grayscale.
"The big concern right now is that this might be a frontrun on the outcome of Grayscale's lawsuit against the SEC; optimism on that front has been keeping markets inflated above whether they might otherwise be for much of the summer," Edwards said.

Most Viewed

 
 
Business

Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
TT
TT

Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)

Saudi Arabia’s digital advertising sector is experiencing rapid growth, but a significant portion of its revenues is leaking to foreign platforms. To maximize the impact on the national economy, experts are calling for strategies to curb this outflow and redirect it to local channels.

The importance of retaining digital ad revenues lies in the substantial size of this market. It is estimated that approximately $1 billion in ad spent is lost annually to foreign platforms, representing a considerable loss to Saudi Arabia’s economy.

Dr. Ebada Al-Abbad, CEO of Marketing and Communications at Tadafuq, a Saudi digital advertising network, told Asharq Al-Awsat that the problem stems from the fact that although advertisers, products, and audiences are often local, the largest share of financial gains goes to foreign platforms. He estimated that 70-80% of the $1.5 billion spent on digital advertising in Saudi Arabia in 2022 went to global platforms such as Google and Facebook. This results in the national economy losing nearly $1 billion annually from this sector alone.

Al-Abbad noted that government agencies in Saudi Arabia also contribute to the outflow. He explained that public sector spending on digital advertising, intended to raise awareness among citizens and residents, frequently ends up on foreign platforms. Government spending makes up about 20-25% of the total digital ad market in the Kingdom, meaning hundreds of millions of riyals leave the country annually, weakening the local digital economy.

Al-Abbad argues that Saudi Arabia needs strong local digital ad networks to keep this revenue within the national economy. These networks would help create jobs, drive innovation, and promote cultural diversity in digital content. Developing local platforms would also enhance Saudi Arabia’s digital sovereignty by ensuring that data remains within the country and is not controlled by foreign entities.

Moreover, local networks would reduce dependence on international platforms, ensuring that the economic benefits of digital advertising remain in the Kingdom, he said, stressing that this would align with Saudi Arabia’s broader Vision 2030 goals, which emphasize building a robust, diversified economy driven by local industries and digital transformation.

Globally, the digital advertising sector is growing rapidly. In 2022, worldwide spending on digital ads reached $602 billion, and it is projected to hit $876 billion by 2026. In the Middle East and North Africa (MENA) region, the digital ad market grew to $5.9 billion in 2022, with Saudi Arabia’s market accounting for over $1.5 billion.

In other countries, the digital ad sector plays a crucial role in boosting national economies. For example, in the United States, the digital advertising industry contributed $460 billion to the GDP in 2021, about 2.1% of the total. In the UK, the sector accounted for 1.8% of GDP in 2022. This shows how important digital advertising can be in driving economic growth.

One of the key challenges facing Saudi Arabia’s digital ad sector is the dominance of global platforms like Google and Facebook, which control 60% of the global digital ad market, Al-Abbad told Asharq Al-Awsat. This dominance results in a significant outflow of revenue and allows these platforms to control digital data and content. He warned that this could undermine Saudi Arabia’s national sovereignty over its digital economy.

To counter this, he emphasized that Saudi Arabia needs to build competitive local networks that can retain a larger share of the market. This will not only keep more revenue in the country but also strengthen the Kingdom’s control over its digital data and content.