Bitcoin
and other cryptocurrencies retreated Thursday after the Federal Reserve signaled higher interest rates ahead even after pausing its campaign of hikes this month.
The price of
Bitcoin
has retreated 4.1% over the past 24 hours to about $24,880, staying well below the $26,000 and $27,000 range that has dominated for much of the period since the largest digital asset hit a 10-month high above $30,000 in April.
The Fed’s aggressive rate hikes since March of last year have undercut higher-risk assets such as cryptocurrencies. Hopes that the cycle had peaked, and that rate cuts may come into play in the foreseeable future, were effectively dashed by Fed Chairman Jerome Powell. The Fed now sees two more quarter-point hikes this year and no cuts, projections showed.
“Once the penny dropped that more hikes are likely and we’re in a higher-for-longer rates environment, Bitcoin lost its hold,” said Antoni Trenchev, a managing partner at Nexo. “Bitcoin is nervously looking at the low $20,000s. It’ll be a while before this torrid time for crypto blows over.”
Other cryptocurrencies were also down.
Ethereum,
the second-biggest coin, plunged 6.4%.
Cardano
lost 7.2%,
Polygon
fell 6.7%,
Dogecoin
retreated 1.5%, and
Shiba Inu
declined 4.2%.
Write to Brian Swint at brian.swint@barrons.com
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