In the final days of 2024, the cryptocurrency market saw a major shock as bitcoin nearly touched $93,000, dragging major cryptocurrencies down. Ether, Solana's SOL, Cardano's ADA, XRP, and BNB fell as much as 16%, while dogecoin dropped more than 27%. The total crypto market capitalization fell more than 11%, marking one of the worst days of the year.
Traders attributed the decline to the dovish tone of the recent FOMC meeting, as the prospects for a Fed rate cut were less bright than expected. Jeff Mei, COO of crypto exchange BTSE, advised caution until inflation is under control. However, he also believes that future economic stimulus measures will increase liquidity and support the crypto market, especially bitcoin, as it increasingly takes on the characteristics of a safe haven asset like gold.
Bitcoin (BTC) is looking to rebound from a steep decline, retesting December lows after a major liquidation event hit late investors. Despite briefly surpassing $96,000, Bitcoin is down 1.5% on the day, hovering around $92,000. Trader Rekt Capital noted that Bitcoin is experiencing its first Price Discovery Correction, which could present a buying opportunity as corrections often precede reversals.
In the past 24 hours, the total liquidation volume in the crypto market reached $1.4 billion, and notable selling pressure was observed on the US-based exchange Coinbase. In the broader economic context, US inflation data showed a slight decline, bringing some relief to the market but also indicating that inflationary pressures are continuing. Market expectations for the Federal Reserve's interest rate policy also adjusted slightly following the PCE inflation report.
The article emphasizes that investing always involves risk and encourages individuals to conduct thorough research before making a decision.
