The news is being updated
On Wednesday, September 21, the US Federal Reserve System (FRS) increased the key rate range by 75 basis points at once, to 3-3.25%. The cryptocurrency market reacted with a fall.
The price of bitcoin fell below $19,000. At the moment, digital gold quotes fell to $18,666.
Hourly BTC/USDT chart on Binance exchange. Data: Trading View.
Most of the top 10 cryptocurrencies by capitalization were in the red zone. XRP (-3.1%), Cardano (-0.8%) and Ethereum (-0.7%) lost more than others in the last 24 hours.
How does the Fed rate affect the prices of cryptocurrencies?
In March, the Fed raised its key rate to 0.25-0.5% for the first time since 2018. The local rally of cryptocurrencies continued until April – Bitcoin and Ethereum reached annual highs.
In May, the Fed raised rates again by 50 bp. On the background of the news, bitcoin crossed the $40,000 mark, but on the same day failed the $36,000 level, which was the beginning of a protracted correction.
In June, the Fed raised its key rate by 75 bp. n. for the first time since 1994. The indicator reached the level of 1.5–1.75%, to which bitcoin reacted with a short-term increase to $22,000, and then collapsed below $18,000.
Recall that the July increase in the rate to 2.25-2.5% led to the growth of the cryptocurrency market. Bitcoin then crossed the $22,000 mark, and Ethereum – $1,500.
At the end of the summer, digital gold reacted to the speech of the head of the Fed, Jerome Powell, by falling below the $21,000 level.
#Fed #raised #key #rate #Bitcoin #falls