Bitcoin loses value following Fed's interest rate announcement

The US Federal Reserve's (Fed) decision to keep the federal funds rate unchanged in the 5.25 - 5.50 percent range at yesterday's meeting has impacted crypto assets.

Fed Chair Jerome Powell addressed expectations for a rate cut in March, stating, "It is not likely that the Fed will have sufficient confidence by the March meeting to cut rates."

Following the decision, market pricing showed the probability of a rate cut on March 20 falling from 55 percent to 35 percent. A rate cut beginning on May 1 is now priced in with a 90 percent probability.

DOLLAR GAINS VALUE

The postponement of the rate-cutting process from March to May has had an effect on the markets. As the dollar gained value again, stock markets and cryptocurrencies, which are seen as risky assets, lost value. Yesterday, the Nasdaq index on the New York Stock Exchange fell by 2.23 percent, the S&P 500 index by 1.61 percent, and the Dow Jones index by 0.82 percent.

The decline in risky assets also reflected on crypto assets. As of midday today, Bitcoin was trading at 42,300 dollars with a 1.8 percent decline, while Ethereum was trading at 2,270 dollars with a 2.7 percent decline.

Solana was trading at 95.2 dollars as of midday today, down 5.2 percent. Ripple found buyers at 0.49 dollars, down 3.3 percent.

News Source: 12punto