The raging inflation and the Federal Reserve’s approach to fighting it have seemingly affected the crypto market negatively. The first sell-off trend started when the Feds announced an interest rate hike in July 2022. Even though the Terra Luna crash worsened the situation, the market was already on the brink of collapse.
Many people panicked and didn’t want to pay high interest on their crypto gains. Since then, the Feds have come up with many unfavorable decisions in the inflation fight. Recently, Jerome Powel announced a stricter approach on August 26, causing another downtrend in the crypto market and beyond.
Related Reading: WATCH: Bitcoin Versus DXY And The Dangerous TD9 Setup Source: BTCUSD price chart from TradingView.com
The Crypto Market And Inflation Fight?
The continued interest rate hike caused a lot of damage to the crypto market. The first response was the dumping of crypto holdings, leading to a price crash. Then after Terra collapsed, a long period of the bearish trend followed, tagged “Crypto Winter.”
As a result of these activities, the overall crypto market cap slumped from $3 trillion to $1 trillion. On August 29, the market cap lost $50 billion and fell below $1 trillion. Thankfully, crypto assets recovered slightly on August 30, pushing the figure back to $1 trillion.
Cryptos such as Bitcoin and many altcoins have lost massively. Tracing BTC price from November 2021, the coin has lost 65% from its all-time high of $69K. Currently, the market is celebrating BTC at $20K since it dipped below that level on August 29.
Related Reading: Ethereum Trading Volume At Its Most Sluggish, ETH Price Struggles Below $1,600
Analysts have predicted difficult months for BTC and ETH, following historical trends and movements on the chart. But many are hoping that the current positive actions from August 30 continue.
Featured image from pixabay and chart from TradingView.com
The raging inflation and the Federal Reserve’s approach to fighting it have seemingly affected the crypto market negatively. The first sell-off trend started when the Feds announced an interest rate hike in July 2022. Even though the Terra Luna crash worsened the situation, the market was already on the brink of collapse.
Many people panicked and didn’t want to pay high interest on their crypto gains. Since then, the Feds have come up with many unfavorable decisions in the inflation fight. Recently, Jerome Powel announced a stricter approach on August 26, causing another downtrend in the crypto market and beyond.
Related Reading: WATCH: Bitcoin Versus DXY And The Dangerous TD9 Setup
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