Bitcoin delivered another white-knuckle ride Tuesday, briefly turning positive before resuming its slide as speculators struggled to price in the prospect of even bigger Federal Reserve interest-rate hikes to quell inflation and the consequences of the halt of withdrawals by the lending platform Celsius.

The largest digital token was down about 5% to $22,053 as of 7:24 a.m. in New York. It had dropped as low as $20,823, the least since December 2020. Ether was down as similar amount, while altcoins such as Solana, Avalanche and Polkadot were mixed.

Cryptocurrencies have become emblematic of a flight from speculative assets as monetary policy is tightened around the world to fight inflation, draining liquidity from global markets. Each swoon evokes the obligatory question of whether the time is right to buy the dip because a nadir may be close at hand.

"There were some buyers waiting for an opportunity to buy on dips and that's why Bitcoin has come off its lows," Sathvik Vishwanath, chief executive officer of the Unocoin crypto exchange, said from Bengaluru, India. But the reprieve may be temporary as retail investors remain jittery about liquidity, he said.

Crypto lender Celsius freezing withdrawals on Monday exacerbated worries about the stress in the digital-asset sector, marking a fresh crisis just a month after the Terra stablecoin's collapse roiled the market. News of Celsius's decision helped push the overall crypto market capitalization below $1 trillion on Monday for the first time since January 2021.

Some market watchers are predicting more fallout from Celsius's troubles.

"A run on Celsius could end up having a bigger impact on the market as a whole than the collapse of the Terra ecosystem — that hurt a lot, but was relatively isolated," Noelle Acheson, head of market insights at Genesis Global Trading, said in a Twitter thread on Monday. "This implosion could impact many ecosystems, as Celsius has a range of assets leveraged on several platforms."

Traders are also monitoring MicroStrategy Inc., whose big bet on Bitcoin is backfiring. The firm loaded up on the coins and may need to post additional collateral for a loan as Bitcoin tests a key price range it flagged last month. MicroStrategy owns about $2.7 billion in Bitcoin.

More than $1.1 billion was liquidated in the crypto markets on Monday — about $685 million of longs and $468 million on the short side, according to Coinglass data. That's the most for both longs and shorts in at least the past three months, the data showed.

Crypto linked shares in Asia, such as Monex Group and SBI Holdings Inc., retreated Tuesday amid the sour overall mood.

Some strategists are looking for signs of a crypto bottom. Mark Newton of Fundstrat Global Advisors said Bitcoin is "getting closer to intermediate-term levels of support which suggest buying dips should be correct by the end of the second quarter."

Joanna Ossinger and Suvashree Ghosh report for Bloomberg News.

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