Bitcoin, the largest cryptocurrency by market capitalization, plunged to an intraday low of $58,528 on Monday, the steepest drop since mid-April, as continued pessimism over the amount of rate cuts weighed on sentiment toward cryptocurrencies.
Bitcoin, the largest cryptocurrency by market capitalization, plunged to an intraday low of $58,528 on Monday, the steepest drop since mid-April, as continued pessimism over the amount of rate cuts weighed on sentiment toward cryptocurrencies.
The cryptocurrency crash earlier this week came amid questions about the Federal Reserve’s scope to quickly cut interest rates from a two-decade high.
Amid the current market situation, Fed officials recently made crucial comments that would have significant implications for cryptocurrencies.
Federal Reserve Governor Michelle Bowman saying On Tuesday, the U.S. government said it was not yet time to start cutting interest rates, dampening hopes for U.S. interest rate cuts. It also said it would consider raising interest rates if inflation did not decline.
Tomiwabold OlajideThe comments reflect a prevailing sentiment at the central bank, where most policymakers have said in recent weeks that while they still expect inflation to return to the Fed’s 2% target, they need more evidence.
The S&P 500 and Nasdaq 100 erased gains after Federal Reserve Governor Michelle Bowman made her comments.
This is how the cryptocurrency market responded
However, bitcoin and cryptocurrencies did not react with indifference. Bitcoin bounced above $62,000 on Tuesday and hit highs of $62,400.
Cryptocurrencies were also up broadly, with a handful of crypto assets in the green at press time. Frog-themed cryptocurrency Pepe was trading up 9%, and Dogwifhat (WIF) was also up 7.30%. Notcoin (NOT) was up 13% in the same time frame.
Although slightly lower, Bitcoin moved little over the past 24 hours, rising 0.97% to trade at $61,595 at the time of writing.
Tomiwabold OlajideBitcoin hit a high of $73,798 in March, but this quarter it is lagging behind traditional investments such as stocks, bonds and gold. The 200-day moving average, currently around $57,738, is seen as a potential support zone for the price in case of further declines.
In the coming days, investors and market participants will be closely watching the Federal Reserve’s policy decisions and their implications for cryptocurrencies.
