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17.08.2023 19:26, Sergey Surabekyants
Bitcoin fell below $28,000, and all other cryptocurrencies also came under pressure due to renewed investor concerns about the state of the US economy. The fall began after the publication of the minutes of the July meeting of the US Federal Reserve, which expressed the fears of officials about rising inflation, which could lead to a further increase in rates.
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At the July meeting of the central bank, the Fed raised its benchmark interest rate to its highest level in more than 22 years. Markets are now hoping that the central bank will no longer change interest rates this year. In response, the stock market fell for the second day in a row, and 10-year US Treasury yields hit their highest close since 2008.
Bitcoin’s correlation with stocks is at its lowest level in two years, according to Coin Metrics, although it reached an all-time high in 2022 in response to the Fed’s campaign to raise rates to curb inflation.
“While inflation itself can be an argument in favor of the growth of crypto assets, along with inflation come other aspects, such as a decrease in risk appetite on the part of investors who fear a recession and the avoidance of bitcoin as a riskier asset.”Sylvia Jablonski, chief investment officer of Defiance ETFs, explained the situation.
Image Source: CNBC
According to experts, this week the 90-day volatility of Bitcoin and Ethereum fell to multi-year lows at 35% and 37%, respectively. They are also confident that the return of Bitcoin to $30,000 at the end of June “happened on low volume, so the rally didn’t have much power.” The expected debut of the U.S. Bitcoin ETF, one of the biggest positive catalysts for cryptocurrencies, is being delayed, which has also dampened investor interest in crypto assets. At the time of publication of the news, the bitcoin exchange rate is $27,800.
Several top crypto assets by market cap, including Binance’s BNB, Ripple’s XRP, and Solana and Polygon, fell more than 1% on Thursday.
2023-08-17 16:26:00
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