Shares of cryptocurrency-related companies have tumbled, with Bitcoin falling below $20,000 following increasingly hawkish Fed rhetoric.
Shares of cryptocurrency miners Marathon Digital and Riot Blockchain fell 5% in the past day. Shares in Nasdaq-listed U.S. cryptocurrency exchange Coinbase fell 4 percent, while digital payments group Block fell 3 percent. Meanwhile, business intelligence firm MicroStrategy, which holds a large amount of bitcoin, fell 5.4 percent.
Fed Focused on Inflation
Federal Reserve Chairman Jerome Powell last week addressed economists and central bankers In his 10-minute speech, Chang said monetary authorities would continue to aggressively raise interest rates until inflation was brought under control to their 2 percent target.
As inflation and higher interest rates weigh on the economy, investors are fleeing riskier assets such as cryptocurrencies and tech stocks. For example, these recent comments caused Bitcoin to drop below $20,000 for the first time since July 13.
According to Tom Essaye, founder of Sevens Report Research, Bitcoin’s decline has recently mirrored the moves in stocks. He told Barron’s because both are “waiting for what’s going to happen in the economy.” The resolution of things, no one knows”, he doesn’t think bitcoin is any different from stocks. The S&P 500 plunged 3.4% following Powell’s hawkish comments on Friday.
Meme stocks are here to stay
Meanwhile, meme stocks are closely related to cryptocurrencies Another financial trend, thanks to trading platforms like Robinhood, seems to have become a fixture. Nearly two-thirds of the 522 respondents to the latest MLIV Pulse survey expect some form of meme stock mania to persist. While the survey suggests meme stocks are likely to be here to stay, 69% of respondents said the phenomenon is unlikely to see trading volumes like the January 2021 peak.
“We see eToro’s U.S. investment analyst Callie Cox saying, “Meme stocks are just another way for retail investors to participate in the market. “
For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here .
Disclaimer
All information contained on our website is published in good faith and for general informational purposes only. Any action taken by readers with respect to the information on our website is entirely at their own risk.
