Cryptocurrency market capitalisation, in the week ending July 29, stayed above $1 trillion at the same time as the US Federal Reserve (Fed) hiked its key rate of interest by 75 foundation factors on July 27. Bitcoin has rallied over 10 per cent since Wednesday and Ethereum has jumped over 15 per cent. However, experts say the crypto market’s disaster is not over.
“This should not be considered as Crypto winter is over. We are not there yet. Crypto is not immune to global factors or economies of the world,” Dileep Seinberg, Founder & CEO, MuffinPay, mentioned.
“This can be considered as a relief rally as the worst was priced in the market and things were not as bad as were expected. A 75 bps rate hike is less hawkish than a 100 bps rate hike,” Seinberg mentioned.
The Fed’s 75 foundation factors price hike got here as a reduction to many as policymakers anticipated a much bigger hike attributable to excessive inflation. The US central financial institution, on June 27, additionally introduced that the inflation in the nation for June stood at 9.1 per cent, a lot increased than its higher tolerance stage of two per cent.
Recession fears had weighed down the markets, throughout the globe, for the final two weeks. However, Fed chair Jerome Powell in his assertion, on Wednesday, mentioned that the US is not in recession, at the same time as the US GDP contracted by 0.9 per cent in the final quarter. He additionally added that additional coverage selections might be based mostly on future numbers.
“The Fed’s evasion of questions on bond market pricing and forward guidelines by stating that future monetary policy decisions will be completely data-dependent was characterised as extremely dovish by the market with speculation that peak Fed hawkishness is behind us amidst an ease in commodity prices and other essential goods,” mentioned CoinDCX‘s analysis group.
At 4pm on Friday, Bitcoin, the largest cryptocurrency by market cap, was buying and selling at $24,048.36, based on coinmarketcap.com. Ethereum, the second largest cryptocurrency, was at $1,720.56. The whole market cap of the crypto market was above $1.1 trillion.
Some experts are extra optimistic about the crypto market in the coming days.
“They [markets] don’t usually react on what happened or what’s happening but rather on what might happen in say next 2,4 or 6 months. So, a futuristic view of the market is what is helping the Crypto market in being resilient & reaffirms its bright future,” mentioned Punit Agarwal, founder and CEO, of KoinX.
“If the bull rally continues with limited sell-offs, we might see BTC reaching US$25,000 soon. A broad accumulating trend can break this level. While on the other side, Ethereum has been on a consolidation phase and is moving to test the US$1,800 level. If bulls can hold Ethereum at the current level today, we might see it testing the US$2,000 level in the coming week,” Edul Patel, co-founder and CEO of crypto investing platform Mudrex advised Business Standard.