The cryptocurrency market is facing tension due to U.S. monetary policy and international conflicts. This article provides an assessment of the current situation.
Impact of Fed Policies
The U.S. Federal Reserve has opted to maintain its restrictive monetary policy, putting pressure on the cryptocurrency market. Market participants await further direction from Fed Chair Jerome Powell. While hopeful for potential growth in the latter half of the year, current economic conditions dampen risk appetite.
Geopolitical Factors on the Market
The conflict between Israel and Iran is also contributing to market instability. BRN's Chief Research Analyst, Valentin Fournier, highlights that "the continuation of restrictive monetary policy, slow ETF inflows, and rising geopolitical risks have turned short-term momentum negative."
Prospects for Market Recovery
Despite recent downturns, there remains potential for recovery. 21Shares strategist Matt Mena expresses cautious optimism. "If the Fed decides to cut interest rates in September, this could lead to positive changes in the crypto industry," he notes. Increased venture capital funding and growing institutional investments also strengthen positive forecasts for the second half of the year.
The cryptocurrency market stands at a crossroads, where further steps will depend on clear signals from the Federal Reserve and developments in geopolitical situations. At the same time, investor optimism indicates potential market resilience.
