Bitcoin Faces Decline Amid Cautious Fed Rate Hike Strategy, Raising Investor Concerns
The post Bitcoin Faces Decline Amid Cautious Fed Rate Hike Strategy, Raising Investor Concerns appeared on BitcoinEthereumNews.com.
Bitcoin experienced a significant drop following remarks from Federal Reserve Chair Jerome Powell, indicating a more cautious approach to interest rate cuts in the upcoming year. The decline in Bitcoin, alongside major cryptocurrencies like Ethereum and XRP, reflects an investor shift away from high-risk assets amid a tightening monetary policy outlook. According to a recent report from COINOTAG, Powell noted that “the bank can therefore be more cautious as we consider further adjustments to our policy rate,” prompting a reaction in the crypto markets. Bitcoin and major cryptocurrencies fell sharply after the Fed indicated a slower pace of rate cuts, shifting investor sentiment in the cryptocurrency market. Bitcoin and Major Cryptocurrencies React to Fed’s Interest Rate Strategy The cryptocurrency market witnessed a sharp downturn as Bitcoin and other major digital assets responded negatively to Federal Reserve Chair Jerome Powell’s announcement on interest rates. Following Powell’s press conference, Bitcoin, the largest cryptocurrency by market capitalization, dropped nearly 5%, trading now at $101,430, after reaching an all-time high of over $108,000 earlier this week. This decline is particularly alarming as it reflects a broader risk-off sentiment among investors concerning digital currencies, which tend to be more volatile. Impact on Other Major Cryptocurrencies Similarly, other cryptocurrencies like XRP fell by 10% in a single day, compounding earlier losses despite a recent spike. Dogecoin, a popular meme-driven cryptocurrency, also saw a significant decrease, dropping 9% to $0.363, marking its lowest point in a month. These rapid declines illustrate the interconnectedness of crypto assets when significant global financial changes occur. Moreover, such price fluctuations also amplify concerns over the stability of these currencies in the face of economic shifts. The Federal Reserve’s Cautious Stance The Federal Reserve’s decision to cut interest rates by 25 basis points was closely watched by financial markets. However, Chair Powell…
