Bitcoin, the leader of the crypto market, fell below $ 34 thousand. The leading altcoin Ethereum, on the other hand, is trading around $2,200 with a 10% loss.
Bitcoin and the cryptocurrency market in general failed to make a good start to 2022, after a terrific 2021. Many things can be counted as the reason for this, but the most important factor is the news that the Fed will go to tight monetary policies and interest rate hikes.
The Fed's tight monetary policy means a decrease in money in the market. Therefore, investors seem to be abandoning risky assets such as Bitcoin and cryptocurrencies. The meeting of the Fed this week is important in this sense.
Bitcoin has lost 7% in the last 24 hours. At the time of this news, Bitcoin price was trading around $ 33,075.
Market outlook is negative. As a result of the Fed's tight monetary policy and gradually reducing purchases, the dollar may decrease in the market and investors may continue to abandon Bitcoin and similar risky assets. Let's see how this week's Fed meeting will change the outlook.
Investment firm Invesco predicts that 2022 will pass as a "Crypto Winter".
Bitcoin had soared from around $33,000 in early 2021 to $69,000 in November, closing the year around $46,000.
In Ethereum, the situation is no different. Ethereum last saw its ATH 2 months ago, reaching $4878. At the time of this news, it was trading at $ 2243.
While Ethereum has lost 32% in the last 1 week, it has lost around 11% in the last 24 hours. Another major altcoin that has lost the most in the last 24 hours is Solana. Solana has lost more than 20% in the last 24 hours. It is currently trading at around $83.56.