What You Should Know:
- A significant slide in the crypto market intensified as U.S. trading commenced, pushing Bitcoin (BTC) close to the $93,000 mark.
- Major cryptocurrencies including Ether, Solana (SOL), Cardano (ADA), XRP, and BNB experienced declines of up to 16%. Meanwhile, memecoin Dogecoin (DOGE) plummeted by over 27%.
- Traders attribute the market shift to a hawkish tone from this week's Federal Open Market Committee (FOMC) meeting, impacting market sentiment.
A recent downturn in the cryptocurrency market witnessed Bitcoin nearing the $93,000 mark as trading sessions in the U.S. began. This development led to across-the-board losses for major crypto assets.
Ether, Solana’s SOL, Cardano’s ADA, XRP, and BNB experienced declines of up to 16%, while Dogecoin saw a sharp drop exceeding 27%. Overall, the crypto market capitalization has decreased by over 11% in the last 24 hours, marking one of the most significant one-day declines of the year.
Some traders are expressing caution, noting that the hawkish signals from this week's FOMC meeting influenced the market's outlook just ahead of the new year.
"The Fed rate cut was anticipated and factored in, as the markets focused on the Fed’s predictions for the upcoming year, which turned out to be less optimistic than expected," said Jeff Mei, COO of crypto exchange BTSE, in a Telegram message. "Traders should proceed with caution until inflation is controlled and we observe more definitive policies from Trump in the upcoming year."
Mei further commented on the broader potential for the crypto markets, suggesting that monetary and fiscal policy measures globally will ultimately increase liquidity, potentially benefiting cryptocurrency markets, especially Bitcoin, which may be perceived increasingly as a safe haven asset similar to gold.
