FOMC Minutes Trigger Sharp Decline in Cryptocurrency Prices

Cryptocurrencies experienced a significant downturn after the release of the FOMC minutes. #Bitcoin , which was trading around $36,750 before the minutes were disclosed, plummeted to below $37,000 afterward. Similarly, #Ethereum also faced a substantial drop, falling below $2,000.

The decline in #cryptocurrencies. can be attributed to the confirmation of #fomc 's intention to continue a tightening policy. The potential increase in interest rates and balance sheet reduction may diminish demand for risky assets. Cryptocurrencies are considered a riskier asset class compared to traditional financial markets. Therefore, the reaffirmation of FOMC's commitment to a tightening policy has reduced demand for cryptocurrencies, leading to a decline in prices.

The continuation of the decline in cryptocurrencies can be anticipated. The FOMC signals an intent to pursue a tightening policy to curb inflation, creating an unfavorable environment for cryptocurrencies.

However, cryptocurrency markets are highly volatile, and short-term movements may not necessarily reflect long-term trends. Therefore, it is not certain that the decline in cryptocurrencies will persist.