• Dapps:16.23K
  • Blockchains:78
  • Active users:66.47M
  • 30d volume:$303.26B
  • 30d transactions:$879.24M

How Fed Rate Changes Affect Cryptocurrencies

user avatar

by A1

2 hours ago


On December 19, the cryptocurrency market experienced a 7.5% drop following the US Federal Reserve's decision to lower the interest rate by 25 basis points to a target of 4.25%-4.50%. This decision led to an outflow of investments from riskier assets, including cryptocurrencies.

The Fed's Decision and Its Consequences

On December 19, the US Federal Reserve reduced the interest rate by 25 basis points to a level of 4.25%-4.50%. This reduction affected the cryptocurrency market, which dropped by 7.5% as investors began to move away from riskier assets. Beth Hammack, President of the Federal Reserve Bank of Cleveland, voted in favor of maintaining the current interest rates, emphasizing concerns about inflation.

Legal Issues and Cryptocurrencies

Federal Reserve Chair Jerome Powell stated at a conference on December 18 that the central bank will not hold Bitcoin and is not seeking legislative changes in this area. His comments impacted the market, especially following US President Donald Trump's statements about plans to create a US Bitcoin strategic reserve.

Proposals for Increased Liquidity

US Senator Cynthia Lummis proposed creating a strategic Bitcoin reserve, suggesting that the US Treasury would purchase 200,000 bitcoins annually. This could increase liquidity in the financial system and boost interest in cryptocurrencies both in the US and Europe.

The increased volatility of the cryptocurrency market is linked to changes in US monetary policy and legal aspects of cryptocurrency regulation. This creates both new opportunities and challenges for investors and policymakers.

0

Share

Other news

XProtocol Advances Innovations in Web3 Entertainment on Blockchain

XProtocol offers unique blockchain solutions for mass adoption of Web3 technologies in the entertainment industry.

user avatarA1

16 minutes ago

Bitcoin's Decline: Factors Behind the Drop Below $100,000

Bitcoin's price hit $98,839 following the Fed's statement on future tightening measures in 2025.

user avatarA1

17 minutes ago

鹏鹏: A New Era for Meme Coins

鹏鹏 ($PENGPENG) merges Chinese culture with meme magic, unlocking new potential on the Solana platform.

user avatarA1

17 minutes ago

Global Games Show Inaugural Edition Concludes with Success in Dubai

Global Games Show 2024 in Dubai brought together gamers, developers, and industry leaders, showcasing innovations in gaming, Web3, and AI.

user avatarA1

17 minutes ago

Embezzlement of $4.5M: Former Delphi VP Gets 4 Years in Prison

Dylan Meissner sentenced to 4 years for embezzling $4.5M from Delphi Digital, highlighting trust risks in corporate finance.

user avatarA1

18 minutes ago

Fartcoin's Market Cap Milestone: Analysis and Prospects

Fartcoin reaches $1 billion market cap, ranking 9th among meme coins. Analyzing the growth and market fluctuations.

user avatarA1

20 minutes ago

dapp expert logo
© 2020-2024. DappExpert. All rights reserved.
© 2020-2024. DappExpert. All rights reserved.

Important disclaimer: The information presented on the Dapp.Expert portal is intended solely for informational purposes and does not constitute an investment recommendation or a guide to action in the field of cryptocurrencies. The Dapp.Expert team is not responsible for any potential losses or missed profits associated with the use of materials published on the site. Before making investment decisions in cryptocurrencies, we recommend consulting a qualified financial advisor.