The fall of the crypto market has resumed and accelerated after the release of statistics on record inflation in the United States. Bitcoin has fallen 8.5% since Friday and ETH has fallen nearly 20%, according to analysts at the Lootxbit exchange.
The fall of the crypto market: the reasons
Annual inflation in the U.S. was 8.6% in May, exceeding market expectations. This is the highest annual rate since 1981. To fight inflation, the Federal Reserve may tighten its policy – to start raising the rate more sharply (by 0.75% instead of the planned 0.5%) and to reduce the Fed’s balance sheet more quickly. This would result in less liquidity in the markets, and these actions would negatively impact stock markets.
On Friday, U.S. stock markets suffered one of their biggest declines, with the S&P500 down 2.9% and the Nasdaq down 3.5%.