Lark Davis: the crypto market is in dire straits
Well-known cryptocurrency expert Lark Davis noted that the cryptocurrency market is going through a difficult period after the value of Bitcoin (BTC) fell below $62,000. This led to the withdrawal of more than $312 million from the market for August 3, 2024. This state of affairs is due to massive selling in the stock market due to fears of a possible recession in the US economy.
Lark noted that the sector in the United States today is in crisis. This includes poor quarterly profitability results, the number of applications for unemployment benefits, the unemployment rate rising to 4.3%, and the ISM industry manufacturing index falling to 46.8.
The Federal Reserve (Fed) has not yet announced an interest rate cut. However, measures to increase the interest rate are eventually starting to take their toll on the labor market. Davis noted that Fed Chairman Jerome Powell's announcement of a possible cut in September has caused mistrust among financial market participants. According to the researcher, this is directly related to fears that the regulator has already cut the interest rate too late and a postponement could lead to more damage.
The Federal Reserve remains committed to a policy of higher interest rates and expects GDP growth. Meanwhile, Davis emphasized that even the U.K. has decided to cut its interest rate from 5.25% to 5%. "Thus, the US is becoming more and more isolated in its decision," the popular blogger and analyst noted.
"Now we can only hope that the unemployment rate does not increase and sufficient money supply helps the market recovery. The chance of the Fed lowering the interest rate by 0.5 percentage points in September is already 69%," the expert emphasized. As of August 4, the cryptocurrency bitcoin was trading at $60,820. This figure has fallen by 10.6% over the past week.
