What to know:
- A broad crypto market slide worsened at the start of U.S. trading hours as bitcoin (BTC) neared the $93,000 level.
- Ether, Solana’s SOL, Cardano’s ADA, xrp (XRP) and bnb (BNB) fell as much as 16%, while memecoin dogecoin (DOGE) fell over 27%, data shows.
- Some traders say a hawkish tone in this week’s FOMC meeting flipped market sentiment ahead of the new year.
As a seasoned researcher with over two decades of experience in financial markets, I have seen numerous market fluctuations and cycles. The current crypto market slide is yet another reminder of the inherent volatility in this space.
As a researcher observing the cryptocurrency landscape, I noticed a significant downward trend in the broader market at the commencement of U.S. trading hours. The price of Bitcoin (BTC) was approaching the $93,000 mark, which seemed to trigger a sell-off across all major tokens, causing them to retreat.
These cryptocurrencies – Ether, Solana’s SOL, Cardano’s ADA, XRP (XRP), Binance Coin (BNB) – experienced a decline of up to 16%. Dogecoin (DOGE) saw an even greater drop of over 27%. The data indicates that the total market value of cryptocurrencies has decreased by more than 11% in the last 24 hours, marking one of the largest single-day drops this year.
According to some traders, the hawkish stance taken during this past FOMC meeting significantly altered the overall market expectations as we approach the New Year.
The reduction in interest rates by the Fed, as predicted, was already factored into market expectations, which were based on the Fed’s less positive outlook for next year compared to previous assumptions. This outlook only projected two rate cuts instead of the four that were initially anticipated. Jeff Mei, COO at BTSE crypto exchange, advised CoinDesk via Telegram message. Traders should exercise caution until inflation is brought under control and more definitive policies from President Trump are revealed in the upcoming year.
Looking at the longer perspective, we’re confident that financial and economic stimulus measures in countries like the U.S., as well as elsewhere globally, will increase liquidity over time. This surge could positively impact cryptocurrency markets, with Bitcoin potentially benefiting significantly due to its growing status as a secure investment similar to gold. This is according to Mei’s statement.
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2024-12-20 16:20