The cryptocurrency market has taken a hit as meetings from the Federal Reserve’s December 2021 show that officials are serious about raising interest rates in 2022. Bitcoin dropped to an all-time low below the $43,000 mark. The global cryptocurrency market narrowed by about $500 billion.
BTC, at the time of writing this article, is down by 7.29% in the last 24-hours. It stands at just the $43,000 mark. The popular cryptocurrency’s market cap dominance is down to down just over 37%. Experts say this is the lowest rate since 2018.
The wider crypto market has suffered a setback. Ethereum has declined by 9.23% and is just below $3,500. Binance Coin, Solana, Cardano and other altcoins also took a hit, with BNB down by nearly 10% and SOL by a little over 12%. Experts say the cryptocurrency market cap is down to $2.2 trillion.
The fall had been predicted by renowned investor Louis Navellier. He had told a London-based media house that Fed’s tapering will create a correction in risk assets, particularly bitcoin. Navellier warned that BTC could drop sharply below $10,000.
Lawrence Gillum, the fixed income strategist at LPL Financial, said the Fed meeting minutes show the bank’s hawkish shift and its intention to remove monetary accommodation this year. It seems like the Fed wants to move quickly and swiftly than it has done in the past. It wants to move higher at the prospect of a quicker tightening timeline.
But experts are not clear about how aggressively it will remove support from markets and the economy. Analysts say that the Fed had been ultra dovish, for most of the pandemic era, with its policy. It was also supportive of markets and spending freely in the economy, but now, it has taken a hawkish stance.