The cryptocurrency market has fallen by more than $1 trillion in six months. Investors are dumping risky crypto assets en masse amid the US Federal Reserve’s rate hike, which is seeking to curb inflation. Bitcoin previously fell below the psychological $30,000 mark, and then recovered to $31,000
The cryptocurrency market has fallen by more than $1 trillion since November 2021 amid a mass exit of investors from risky assets amid rising inflation and new requirements from the US regulator, The Wall Street Journal calculated.
Cryptocurrencies are falling amid the US Federal Reserve’s rate hike, which is seeking to reduce the damage from inflation. The regulator believes that digital currencies are hedging against inflation. Investors are reacting to this with an emergency exit from risky assets.
In addition, according to the WSJ, the market’s losses are exacerbated by the fact that it used to belong exclusively to private investors, but is now dominated by institutional investors, such as hedge funds. At the same time, both private and institutional investors are now leaving risky assets.