Crypto prices keep falling, and it seems like there’s no bottom in sight — here are three reasons why the cryptocurrency market is down.
(source)
Bitcoin
BTC
tickers down
$21,259
price is struggling to hold onto a marginal 0.23% gain.
but generally crypto prices are falling across the board and the wider market remains in a sharp downtrend. Bitcoin price continues to trade under $20,000, a level which many investors believe is a psychologically significant support and resistance level.
Federal Reserve interest rate hikes
Raising interest rates increases the cost of borrowing money for consumers and businesses. This has the knock-on effect of raising business operational costs, the costs of goods and services, production costs, wages, and eventually, the cost of nearly everything.
What to expect for the rest of 2022 through 2023.
The factors impacting falling prices within the crypto market are driven by Federal Reserve policy, meaning the Fed’s power to raise, pause or lower rates will continue to have a direct impact on Bitcoin price, ETH price and altcoin prices.
In the meantime, investors’ appetite for risk is likely to remain muted, and potential crypto traders might consider waiting for signs that U.S. inflation has peaked and for the Federal Reserve to begin using language that is indicative of a policy pivot.