Bitcoin falls below $19,000

Subscribe to our Telegram channel and get instant notifications!

The much anticipated interest rate hike by the US Federal Reserve is now known and it hit the general crypto market hard on Wednesday.

  • The US Federal Reserve increased its key interest rate by 0.75 percentage points, extending it to a range of 3 to 3.25 percent.
  • This number represents a large increase from March, when interest rates were close to zero. And: The subsequent hikes represent the fastest change in central bank policy since the 1980s.
  • The value of Bitcoin (BTC) fluctuated in the hours following the news before falling along with US stocks in the afternoon.

Bitcoin falls below the $19,000 mark

Bitcoin is currently trading at $18,730 – down 1.5% in 24 hours, data from Coingecko shows. Just last week, the largest cryptocurrency was over ,000.

Notice

Ethereum’s drop was less severe but still more than lower. After the Fed’s rate hike announcement, prices fell by more than 4% in both cases.


Recently, the price of Ethereum (ETH) was around $1,250, down 5.5% from the previous day. The price of the second largest cryptocurrency by market cap has fallen since The Merge last week.

The broader crypto market sensitive to a Fed rate hike

Members of the Federal Open Market Committee (FOMC) raised interest rates three times in a row by 75 basis points. This shows how strong inflationary pressures are in America. Of course, the broader cryptocurrency market doesn’t like that.

Because inflation encourages the Fed to raise interest rates, economic data related to inflation is very important to the cryptocurrency market.

See also  5 reasons why Tamadoge will do better than Shiba Inu

As a result, cryptocurrencies have reacted poorly to the recent Fed rate hike report. After the United States Bureau of Labor Statistics released inflation data for August, Bitcoin prices fell 5% and Ethereum prices fell 7% in the following 24 hours.

Powell during his post-session press conference:

“We need to get inflation under control. I wish there was a painless way to do this, but there isn’t.”

Powell’s words indicate a difficult situation for the central bank. The rate of inflation remains high – and it is difficult to cope with it.

However, the extent to which crypto prices can fall this year remains uncertain. Even if there is no negative news about inflation and the US Federal Reserve’s interest rate hike, some experts believe that Bitcoin is still headed for a sharp decline in the $10,000 region this year.

According to Riyad Carey, research analyst at crypto data firm Kaiko:

“I don’t see cryptocurrencies, especially BTC and ETH, escaping Fed influence anytime soon.”

This is another reminder that “cryptocurrencies move at the whim of the Fed.”

Meanwhile, Michael Saylor, chairman and co-founder of MicroStrategy, highlighted that Bitcoin could return to the November high of $68,990 “sometime in the next four years” and reach $500,000 in the following decade if its market cap comes with gold.

Buy BTC at eToro now

Text credit: Bitcoinist

Cryptocurrencies are a highly volatile, unregulated investment product. Your capital is at risk.

Rate this post
Investing Press
Investing Press

we are passionate about science, new technologies, and web development and how to make money on the internet, we share with you tips, tutorials, guides, concerning the creation of blogs and everything related to Web 3.0 and of course the world of Cryptocurrency

Articles: 1199

Leave a Reply

Your email address will not be published.