The Bitcoin fell for the third consecutive session As the expectations of a largest interest rate hike in the United States in three decades decrease the demand for riskier assets.
The correlation coefficient between Bitcoin and US stocks has risen over the past 90 days as investors turn more risk averse due to the withdrawal of the pandemic-era stimulus by the Federal Reservewhich is credited with helping fuel the rise in cryptocurrencies. Alternative currencies like Ether, XRP and Litecoin fell more than the original digital asset.
Bitcoin was down as much as 5.8 percent at $43,210, the biggest intraday drop since March 10. The digital currency is down about 5.9 percent this year.
Altcoins have fallen further due to their lower market value and lower trading volume, which usually results in wider price swings. Cardano decreased by 8.15 percent and Solarium9.6 percent.
Bitcoin broke through the top of its tightest trading range between $30,000 and $50,000 earlier this week, but traders were concerned about another false move. eEther had been outperforming Bitcoin during the rally due to its next technical update scheduled for later this year.
Previously, the billionaire investor Michael Novogratz he said that once the Fed pauses, Bitcoin could start to take off again.
Novogratz, who directs Galaxy Digital Holdingspredicted that the central bank under Jerome Powell will remain “very tight for a while” due to high inflation, and will likely raise interest rates soon in 50 basis points. But as the economy slows and the Federal Reserve steps back, “bitcoin will reach the moonhe said, repeating a popular crypto catchphrase.
Novogratz was speaking at the “Bitcoin 2022” conference in Miami, which kicked off Wednesday with the unveiling of a statue of a bull commemorating the city’s preference for cryptocurrencies and the digital asset industry. The event has attracted more than 25 thousand attendees.