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On Wednesday, cryptocurrency prices were experiencing a drop as concerns due to inflation and tumbling retail stocks attacked Wall Street.
As of this writing, the flagship currency, Bitcoin, was down about 3.28% to $28,872.36 from its ATH of $69,044.77 in November.
Earlier, cryptocurrencies and the stock market had a separation and used to operate independently, enabling investors to transfer their assets to the one moving higher from one to another on the basis of which of the two was moving higher. However, it’s no longer the case now.
On May 18, both markets were experiencing a downfall.
Recently, the Dow Jones Industrial Average was down more than 1,000 points, or 3.2%, as Target missed the first quarter earning’s estimates of Wall Street; this was followed by a Get Walmart Inc. Report. It mentioned weaker-than-expected fiscal-first-quarter earnings and reduced its full-year profit forecast.
In order to reduce price pressures, the Fed is increasing rates aggressively. Jerome Powell, the Fed chairman, hinted that the central bank would probably repeat the half-percentage-point rise in rates in both June and July as it did earlier this month.
Extreme volatility in so-called “stablecoins,” ironically, which were considered a safer option and a steadier, have also affected the crypto prices.
When UST and Luna lost nearly all their value, the prices of the cryptocurrency fell.
The two digital assets went through a huge blow when crypto exchanges OKX and Binance announced the delisting of these coins to safeguard their customers.
Bitfinex Market Analysts have provided a commentary on Bitcoin and the dip in US stock prices:
“Bitcoin is trading lower today after yesterday’s steep drop in US stock prices. Spiraling levels of inflation have left global financial markets staring into the abyss as the prospect of a global recession looms large. This is leaving all assets that have benefited from more than a decade of accommodative monetary policy from central banks vulnerable to a correction as interest rates rise.”
Bitfinex is a crypto exchange that offers crypto trading services to cryptocurrency holders and global liquidity providers worldwide. Founded in 2012, Bitfinex also provides access to peer-to-peer financing, an OTC market, and financed trading for various cryptocurrencies.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
