The crypto market nose-dived overnight, with investors panicking over high US inflation, which led to a bank-style run on a major crypto lending platform.
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The price of the world's largest digital currency, Bitcoin, fell 20 percent overnight to US$22,500 a coin - levels last seen in late 2020.
EasyCrypto New Zealand head Paul Quickenden said "It's fair to say the market is not homogenous, there is a degree of people who are selling, panic and fear is there but there is a degree of robustness in certain parts of the market".
The sell-off was triggered by the threat of large interest rate hikes by the Federal Reserve to curb high inflation, he said.
It was also affected by the large crypto lender, Celsius, freezing withdrawals from its platform after customers rushed to pull their money out, he added.
"Across the board, if you're looking at the Nasdaq, if you're look at the S&P [500] everyone's a bit spooked at the moment by all of those catalysts around inflation, rising interest costs and what's going on in Ukraine, and pending food shortages globally.
"Let's be honest, there's not a tremendous amount of good news in the market."
Some would-be investors could be turned off by the downturn, but others may see it as an opportunity, Quickenden said.
"What was it Warren Buffet said? 'When there's blood in the streets, that's when you buy'."
EasyCrypto had not run into the same liquidity issues that troubled another local marketplace, BitPrime, and it was continuing to add customers, he said.
However, the company was not immune to market volatility.
"When the market is frothy, we see more volume, and when it cools off a little bit, we see less volume."
Looking ahead, Quickenden said the crypto market was going to remain unsettled because of high inflation until there were green shoots that suggested it was levelling off.
"The Fed seemed pretty hawkish on the fact that they are going to go pretty hard at this until they fix it.
"For the investor community that kind of just means buckle up until we get there."