Heres my version of converting that digital currency market breakdown, bearing in mind the subtleties and opportunity for some human translation:
**Digital Currency Market’s Unpredictable Journey: How the Central Bank’s Rate Increases are a Game of Chance**
Santiment’s current in-depth examination uncovers a perplexing reality: the digital currency market’s response to the Federal Reserve’s interest rate verdicts is essentially erratic.
Analyst Brian at Santiment emphasizes that since 2022, when the Central Bank started intensely boosting rates to battle increasing inflation, the market’s been extremely volatile. Occasionally a Central Bank action activates a price increase, other times a considerable decrease, even when the policy result appears comparable. Recall, the Central Bank increased rates from virtually zero in March to a considerable 4.50% by December as inflation reached a 40-year peak of 9.1%.
That stirred up matters significantly. Stocks and digital currency suffered. Bitcoin, for instance, dropped from its $69,000 peak in late 2021 to below $16,000 by the close of 2022. All that tightening of liquidity and greater borrowing expenses truly injured risk assets across the board. Canary Capital Requests ETF, PENGU Value Increases
Ever since, the digital currency market’s been extremely responsive to the Central Bank’s every action. Back in March 2024, when the Central Bank maintained rates constant, Bitcoin soared to over $72,000, only to decline sharply the following month. A comparable pause in May resulted in an instant rebound, but a July verdict triggered a 20% Bitcoin collapse before matters stabilized.
Last September, the initial indication of a rate decrease triggered a robust rise. Then, in November, a digital currency-friendly election outcome combined with another rate decrease propelled Bitcoin soaring to fresh all-time peaks. But when the Central Bank maintained constant in December, the market lost momentum, prompting a correction.
As anticipated, the current Federal Open Market Committee (FOMC) gathering on March 19 sustained rates unchanged at 4.25%–4.50%. Santiment observed that social media discussion surrounding this verdict was lower than during prior gatherings, implying traders had already factored it in.
Despite the expectation, the market reacted favorably. Bitcoin (BTC) soared 4.5% to $85,786, briefly reaching $87,431, while Ethereum (ETH) and Solana (SOL) increased 4% and 6% correspondingly.
The aggregate market capitalization of cryptocurrencies witnessed a surge of 2%, attaining a valuation of $2.91 trillion. The derivatives market underwent $355 million worth of liquidations, predominantly impacting positions betting against price increases.
Anxieties regarding inflationary pressures and decelerating economic expansion endure. Nevertheless, the Chairman of the Federal Reserve, Jerome Powell, has validated anticipations of a pair of interest rate diminishments during the ongoing year. The capacity of the market to uphold its latest advancements remains dubious, given that past patterns imply that preliminary upswings might be deceptive.
