The crypto industry experienced another turbulent week, and the cost of Bitcoin (BTC) dropped below $25,000 for the first time since March 17, due to a hawkish Fed announcement.
Within a half-hour period on June 15th, the cost of Bitcoin dropped 4% from $25,867 to $24,819 as reported by TradingView. At the present time, Bitcoin has recouped its losses and is hovering just over $25,000.
In the last seven days, Bitcoin has remained in the vicinity of $26,000 as the market reacted to the SEC’s legal proceedings against Coinbase and Binance, two major crypto exchanges, as well as the growing economic uncertainty due to the interest rate signals from the United States Federal Reserve.
Roughly three hours after the Federal Reserve declared a halt to the fifteen-month-long series of rate hikes intended to counter inflation, there was a sharp decline in price.
Although the majority of the market had anticipated a rate hold, the Federal Open Markets Committee’s statement indicated potential for additional rate increases in the future, which usually reduces investor enthusiasm for risky assets such as cryptocurrencies.
Josh Gilbert, an eToro Market Analyst, has indicated that Jerome Powell, the Federal Reserve chair, has emphatically stated that this is just a brief interruption, something that could be detrimental to Bitcoin in the long run.
“The positive performance of risky assets such as Bitcoin this year has been based on the idea that inflation will decline and interest rates will reach a peak before being reduced,” Gilbert stated.
Five things to know about Bitcoin this week, including the SEC, CPI, and a potential ‘strong rebound’.
Ether (ETH), the second largest cryptocurrency by market capitalization, also experienced a drop, with its value decreasing by more than 5% from $1,727 to $1,631 within the same period. Other altcoins were not exempt from the bearish sentiment either, with many of the tokens identified as securities in the SEC’s lawsuits declining by more than 3%.
Cardano (ADA) has dropped 3.4% in the past 24 hours, while Polygon (MATIC) and Solana (SOL) have both declined by 3.3% and 2.8%, respectively.
As per Cointelegraph analyst Marcel Pechman, the present options data for Bitcoin points to a further decrease, particularly when taking into account the regulatory opposition to the crypto industry in the United States together with the probability of additional rate hikes from the Fed in the upcoming months.
The magazine reports that Bitcoin is heading towards achieving “Net Zero” goals.
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