Bitcoin, Ethereum, BNB, Solana, Cardano, XRP, Dogecoin, Polkadot, Tron, and Avalanche are all in Rapid Drop Due to U.S. Treasury Secretary’s Warning which Jumpstarted A $100 Billion Crypto Price Crash

2 min read

After U.S. Treasury Secretary Janet Yellen delivered a strong crypto warning, bitcoin BTC -7.3 percent, ethereum, and other major cryptocurrencies fell this weekend, wiping off more than $100 billion from the entire crypto market.

Subscribenow to Forbes’ CryptoAsset & Blockchain Advisor and successfully navigate the volatile bitcoin and crypto market

The bitcoin price has dropped to around $27,000 per bitcoin, its lowest price since late 2020 while ethereum has crashed to under $1,500 per ether. Smaller cryptocurrencies are performing even worse, with BNB BNB -8.6%, solana, cardano, XRP XRP -5.8%, dogecoin, tron and avalanche all seeing double-digit percentage declines over the last 24 hours.

The recent bitcoin and cryptocurrency sell-off was spurred by expectations that the Federal Reserve would step up its fight against inflation by putting its “foot on the throttle” after the latest U.S. consumer price index data indicated the economy is still roaring.

Want to stay ahead of the market and understand the latest crypto news? Sign up now for the free CryptoCodexA daily newsletter for traders, investors and the crypto-curious

After the latest inflation data was announced, crypto investor and influencer Anthony Pompliano stated in his email, “The Federal Reserve is backed into a corner now.”

Prices in the United States grew faster than predicted in May, climbing to 8.6% after dropping in April, pushed by rising energy and food costs and driving inflation to its highest level since 1981, according to statistics released on Friday.

“Despite the Fed’s interest rate hikes and quantitative tightening, inflation has remained stubbornly high. They don’t have many options other than to push their foot down on the accelerator. The Fed may aim to speed up interest rate hikes, both in terms of speed and severity, as well as quantitative tightening. I’m not sure they’ll go through with it, but there aren’t many other options.”

Next week, the Fed is expected to raise its interest rate to 1.25%-1.50%, after a similar move last month. A Reuters survey found economists are forecasting a further 50 basis point rate hike in July.

In an emailed comment, Alex Kuptsikevich, senior market analyst at FxPro, stated, “[Friday’s] inflation number is the last important release before the Fed meeting next Wednesday.” “The public’s attention will be drawn to the weekend if inflation rises to 40-year highs, putting pressure on the Fed. Such a high reading could perhaps lead to a stronger [Fed] stance in the accompanying comments.”

bitcoin, bitcoin price, ethereum, ethereum price, BNB, XRP, solana, cardano, dogecoin, tron, avalanche, image

Over the last six months, the bitcoin, ethereum, and crypto markets have been slowly declining, collapsing alongside the stock market as the Federal Reserve and other central banks across the world raise interest rates and begin to reduce pandemic-era stimulus policies. The Federal Reserve began the long process of quantitative tightening, or decreasing its bloated $9 trillion balance sheet, earlier this month.

“Bitcoin’s continued correlation with stock markets roiled by macro-forces has snuffed optimism and sparked frustration at a time when crypto appears to be missing the perfect opportunity to demonstrate its forgotten role as an inflation hedge,” Rich Blake, a financial consultant at crypto platform Uphold, wrote in emailed comments.

“As global monetary tightening accelerates, equities are still vulnerable to lower lows in the short run, indicating telltale signals of a cyclical bear market.”

Via this site

Have A Story? Get Featured On Fraxfacts Plus 100+ More Exclusive Crypto News Sites