Investors are poised for further changes in bitcoin and other cryptocurrencies, as a hawkish Federal Reserve worry threatens to dampen risk appetite in the markets.
The global crypto market cap stands at $1.90 trillion, up 0.24% from the previous day. The total crypto market volume in the last 24 hours stood at $64.71 billion, a decrease of 27.26%, data from Coinmarketcap.com shows.
The largest cryptocurrency, Bitcoin, fell 0.01% to $42,358.48. Its main rival, Ether, fell 0.43% to $2,921.15.
Other cryptocurrencies such as BNB gained 0.22%, Solana by 0.93 percent, Terra by 3.04%, Avalanche by 0.38%.
The volatility traditionally associated with cryptocurrencies has been on full display in recent weeks.
Their recent volatility comes amid a broader market sell-off, prompting investors to rebalance their portfolios to account for the more aggressive Fed, which is now expected to raise rates by up to seven times this year as it fights rising inflation. fights with.
There are concerns that an ongoing aggressive central bank tightening cycle will hamper riskier assets, making it difficult for some traders to maintain their bullish outlook on bitcoin and other cryptos, an asset class known as Already identified with intense volatility.
Investors said rising tensions in Ukraine, where Washington warned a Russian offensive could begin any day, could also fuel a broader market move.
“Bitcoin has really become the ultimate momentum trade and there are a lot of risks that could trigger a drop of anywhere from 40%,” said Ed Moya, senior analyst at Oanda.
Bitcoin’s volatility hasn’t deterred some analysts from trying to gauge the currency’s fair value or pinpoint potentially important price levels.
Analysts at JPMorgan estimate bitcoin’s current fair value to be around $38,000 — down about 15% from its recent price — based on its volatility compared to gold, another asset investors often use to hedge their portfolios against inflation and economic uncertainty. use to hedge.
“Cryptocurrencies” are going to be very volatile going forward, said Oanda’s Moya, but there are significant players on both the institutional side and the retail side that are still growing, so interest is still rising.
Never miss a story! Stay connected and informed with Mint.
download
Our App Now!!
,