The crypto industry is currently under pressure. Economic uncertainties, inflation concerns and Donald Trump’s trade policy put a strain on the markets. Experts therefore warn of risks around Bitcoin.
• BTC pulls crypto market down
• Experts warn of risks
• Cryptom market remains nervous
The cryptoma markets currently seem to be experiencing a turbulent phase: the Bitcoin course last week fell below the $ 80,000 mark-the loss of value since the all-time high of around $ 10,00 from January is therefore massive. The loss of value happens against the background of growing economic uncertainties and concerns about the future Monetary policy of the US Federal Reserve.
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Inflation, interest rate policy and trade war as stress factors?
An essential factor for the current uncertainty should probably be the debate about the interest policy of the Federal Reserve. In February, US inflation fell to 2.8 percent, a positive signal for possible interest rate cuts, but analysts warn of new risks. In particular, the trade strategy of the now reigning US President Donald Trump could not only lead to higher prices, but also to economic faults.
Larry Fink, CEO of the world’s largest asset manager Blackrock, sees Trump’s trade policy plans a danger to the price stability, as Reuters reports: “I think when we all become a little more nationalistic – and I don’t say that this is a bad thing […] -, this will lead to an increased inflation, “he explains to the participants of the Ceraweek Conference, according to the news agency. This could break hope for quick interest rate cuts by the FED.
Market remains nervous
Although the latest inflation rate was slightly below expectations, the cryptoma market only reacted positively. According to Youwei Yang, chief economist from Bit Mining, a single low consumer price index (CPI) is not sufficient to regain the battered trust of the investors. “The […] Lower than expected, unusual consumer price index should be optimistic and indicate faster interest reductions, but the cryptocurrencies have not reacted strongly, “quotes him forbes in this context.
“What we are currently experiencing is a full-blown reaction to political chaos and global tensions as a result of Trump’s tariffs. While Larry Fink talks about consumer price index models and nationalism, crypto investors sell because the macroredfield feels like a roller coaster ride that will not end so quickly,” Mike Cahill ordered the situation towards the web3 developer Douro Labs “Thestreet”.
At the same time, leading investment banks such as Goldman Sachs and Yardeni Research have increased their recession forecasts. According to experts, Trump’s economic policy decisions in particular could increase the risk of an economic downturn. According to Goldman Sachs, the likelihood of a US recession within the next twelve months has increased from 15 percent to 20 percent, as Forbes continues.
Uncertainty shapes the cryptoma markets
However, while the stock markets already seem to recover from their latest losses, the cryptoma market remains struck. Investors are likely to wait for clearer signals from the Fed or the US government, especially after a little convincing crypto summit in the White House a good week ago. “This decline in market is largely due to general economic concerns, including the fear of recession in the USA and persistent inflation,” explains Sean Dawson, head of the research department from Derive.xyz according to Forbes.
The coming weeks could be crucial for the development of Bitcoin and other cryptocurrencies. However, as long as the economic situation does not stabilize, uncertainty could remain a dominant factor for the cryptoma markets.
Editor finance.net
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