Bitcoin, Ethereum continue downtrend day-after Fed meet, experts say further hike fears to dampen enthusiasm
Major cryptocurrencies, led by Bitcoin and Ethereum continued their downward trajectory a day after the Federal Reserve raised interest rates by 75 basis points. While Bitcoin was trading down about 1 percent at $ 20,200 levels over the past 24 hours, Ether was trading down over 2 percent at $ 1,540 levels.
Kyle Klemmer, COO, and Co-founder of Mech.com says interest rate hikes are causing funds to lay people off and slow down their investments even more, which will, in turn, will slow down the rate at which new tech enters into the space due to how projects are able to raise money. “Once the macro market gets a feel for how high the rates will go, I think then and only then will you see an increase in money being invested into the space from an infrastructure perspective. That’s where I feel most of the pain is being felt at the current moment,” he said.
Robert R Johnson, Professor, Heider College of Business, Creighton University says higher rates are certainly a headwind for risk assets and crypto represents the highest risk of all risk assets. “Crypto speculators were bolstered by unprecedented quantitative easing undertaken in light of the Coronavirus pandemic. The likelihood of rate increases at the next three Fed meetings will certainly dampen enthusiasm for these highly speculative assets,” according to him. Read full here
