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.
Although this might seem inconsequential — not to mention irrelevant to Bitcoin — it's a big deal.
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.
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.
"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."