www.thecoinrepublic.com 5 h Reading time: ~3 m
- 1 It seems like the upcoming hike in FED’s benchmark funds rates is affecting the crypto market.
- 2 As the global crypto market cap is $1.06 Trillion and down by 3.42% over the last day.
- 3 The dominance of Bitcoin also decreased by 0.18% over the day, and is currently 42.03%
Inflation can be easily understood as a rise in prices that simply affect the purchasing power of buyers. In the crypto industry, inflation relates to new coins being introduced to circulating supply by miners and validators. As Bitcoin has a projected fixed supply of 21 million units, with new supply halving almost every 4 years, the current inflation rate is about 1.8%.
At press time, the overall crypto market volume over the last 24 hours is $53.18 Billion, which makes a 0.27% increase. The total volume in DeFi is currently $5.58 Billion, 10.50% of the total crypto market 24-hour volume. The volume of all stable coins is now $47.75 Billion, which is 89.79% of the total crypto market 24-hour volume, as per the data sourced from Coinmarketcap.
Bitcoin price analysis
The most traded cryptocurrency, Bitcoin, is down by almost 6% in the last 7 days, and 4% in the last 24 hours. At press time, Bitcoin is trading at a price of $22,987.30 with a 24-hour trading volume of $24.48 Billion.
Source: BTC/USD by Coinmarketcap
The above chart clearly shows the decline in Bitcoin price in the last 7 days. Meanwhile, in the last 7 days, Bitcoin has given a low at $$22,957.05 and high at $25,126.85.
According to Yahoo News, “the odds of the United States Federal Reserve hiking its benchmark fed funds rate by 50 basis points in March are on the rise after the PCE Price Index showed the disinflation trend reversed in January.”
The risky assets fell following the report, with bitcoin (BTC) dropping around $200 to $23,730 and threatening to fall to $23,000, which would be its lowest level of this week. Additionally, “Nasdaq 100 futures were also down 1.9%, and S&P 500 futures were lower by 1.4%. The crypto-related stocks are off sharply.” Coinbase (COIN), MicroStrategy (MSTR) and Marathon Digital (MARA) are all lower by 5% to 8%.
Joe Brusuelas, RSM Chief Economist noted in a tweet that “Inflation remains stubborn and sticky between 4%-5%. Service inflation continues to increase with goods disinflation cooling. [The] risk of a March 50 basis point hike [is] rising and we are clearing moving toward a 5.5% policy peak at a minimum.”
January Inflation & Policy Takeaway: inflation remains stubborn & sticky between 4-5%. Service inflation continues to increase with goods disinflation cooling. Risk of a March 50bps hike rising and we are clearing moving toward a 5.5% policy peak at a minimum. pic.twitter.com/SrF1D2BBdD
— Joseph Brusuelas (@joebrusuelas) February 24, 2023
The views and opinions stated by the author, or any people named in this article, are for informational ideas only, and they do not establish the financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.