Failure to make this latest interest payment could cause the entire company to collapse, and the prospect of a default has caused Bitcoin to fall before.
One of China's biggest property developers has failed to settle overdue interest payments worth tens of millions of dollars — increasing the likelihood of a disastrous default.
According to the BBC, Evergrande was due to pay $82.5 million on Monday following the expiry of a 30-day grace period, but no transaction had been made.
Although this might seem inconsequential — not to mention irrelevant to Bitcoin — it's a big deal.
Evergrande currently has a debt pile that's worth more than $300 billion, and is struggling to meet its commitments.
Failure to make this latest interest payment could cause the entire company to collapse, sending shockwaves through the global economy — and as nerves grow, shares plunged to a record low on Wednesday.
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Bad News for Bitcoin?
There were signs that the Evergrande crisis was having an impact on Bitcoin back in September — when the world's biggest cryptocurrency fell in tandem with the stock markets. Some analysts have expressed fears that a default would be comparable to when Lehman Brothers collapsed in the U.S. — an event that reverberated around the world.
BTC also fell in November — not long after reaching an all-time high of $69,000 — after reports erroneously suggested that Evergrande had defaulted on its debt obligations.
Renewed jitters about the company's standing have the potential to derail Bitcoin's progress in recent days. The world's biggest cryptocurrency has managed to climb from lows of $42,000 to $52,000 in under 100 hours.
Already on Wednesday, BTC has cooled to $49,087 — losing the psychologically important $50,000 level — raising the prospect of a retest of lower levels in the $40,000s.
Explaining why BTC was affected by Evergrande, Valkyrie Investments CEO Leah Wald had told Bloomberg in September:
"This is part of a well-established pattern where it sells off as traders cash in their riskier assets to cover margin calls and/or sit on the sidelines until markets calm down and they feel more comfortable going back into riskier positions."
