Markets
Key Fed Remark Shakes Crypto Market; And after?
Tomiwabold Olajide
Fed officials recently made crucial comments believed to have significant implications for cryptocurrencies.
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Bitcointhe largest cryptocurrency by market capitalization, fell to an intraday low of $58,528 on Monday, the biggest drop since mid-April, as continued pessimism over the number of rate cuts weighed on sentiment for crypto.
The crypto decline earlier this week came amid doubts about the Federal ReserveIt is possible to quickly reduce interest rates from their highest level in two decades.
Amid the current market environment, Fed officials recently made crucial comments believed to have significant implications for cryptocurrencies.
Michelle Bowman, Governor of the Federal Reserve said As of Tuesday, it was not yet an appropriate time to start lowering interest rates, dampening hopes for lower interest rates in the United States. She also said that if inflation does not ease, she would consider raising interest rates.
The remarks reflect a prevailing sentiment within the central bank, with most policymakers saying in recent weeks that while they still expect inflation to return to the Fed’s 2% target, they need to more evidence.
The S&P 500 and Nasdaq 100 erased gains after comments from Fed Governor Michelle Bowman.
Here’s How the Crypto Market Reacted
Bitcoin and cryptocurrencies, however, showed a muted, barely insensitive response. Bitcoin bounced above $62,000 on Tuesday, reaching a high of $62,400.
Cryptocurrencies also rose broadly, with a handful of cryptoassets in the green at press time. Frog-themed cryptocurrency Pepe was trading up 9%, and Dogwifhat (WIF) was also up 7.30%. Notcoin (NOT) increased by 13% during the same period.
Although down slightly, Bitcoin was little changed over the past 24 hours, up 0.97% to trade at $61,595 at press time.
Bitcoin hit a high of $73,798 in March but has lagged traditional investments such as stocks, bonds and gold this quarter. The 200-day moving average, which currently sits around $57,738, is seen as a potential area of support for the price in case of further declines.
In the coming days, investors and market participants will continue to closely monitor the Fed’s policy decisions and their implications for cryptocurrencies.
About the Author
Tomiwabold Olajide
Tomiwabold is an experienced cryptocurrency analyst and technical analyst. It pays special attention to cryptocurrency research, conducting comprehensive price analysis and trading forecasts on estimated market trends. Tomiwabold graduated from the University of Lagos.