The Stark Fed’s “wake-up call” triggers a 0 billion price drop in Bitcoin and cryptocurrencies

The Stark Fed’s “wake-up call” triggers a $500 billion price drop in Bitcoin and cryptocurrencies

Bitcoin has fallen sharply, falling along with stock markets after the Federal Reserve warned that inflation would remain stubborn and BlackRock unsettled the market.

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Bitcoin price has fallen towards $90,000 per bitcoin, dragging down the broader crypto market and wiping out around $500 billion in value from the $3.2 trillion crypto market.

Bitcoin’s roughly 10% decline in the last 24 hours was dwarfed by Ethereum and smaller top ten cryptocurrencies – including Solana and Dogecoin – which fell 15% to 25%.

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ForbesBlackRock just quietly confirmed a devastating Bitcoin price bomb

This week, Federal Reserve Chairman Jerome Powell disappointed traders when he warned that interest rates would not fall as quickly as the Fed had previously thought, reducing the planned number of rate cuts in 2025 to just four from the previous one would reduce two.

“Comments from the Federal Reserve were a wake-up call,” Danni Hewson, head of financial analysis at AJ Bell, said in emailed comments.

“Inflation is proving stubborn and tax cuts and tariffs could be a recipe for reflation.” “Risk appetite has been scaled back.” “Trump 2.0 is a known unknown and no one wants to be overexposed if the climate proves inhospitable.”

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ForbesThe Fed’s “worst nightmare” suddenly comes true as Bitcoin price rises

Meanwhile, Bitcoin price and crypto market watchers have warned of further volatility.

“Expect volatility to increase for both Ethereum and Bitcoin as we enter 2025, particularly as we approach the expiration date of December 27, 2025,” said Nick Forster, founder of decentralized finance (DeFi) protocol Derive, in Emailed comments: However, he added that he expects the Bitcoin price and the broader crypto market to recover by 2025.

“We are seeing a trend of funds and high net worth individuals moving to longer-dated options such as those targeted for September and beyond, reflecting a positive outlook for 2025. This shift is reflected in the fact that open interest in calls significantly exceeds the number of bets on Derive.xyz, signaling strong market optimism.”

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