Crypto Market Declines

On 1 May 2023, Bitcoin and a series of alternative cryptocurrencies such as Cardano, Polygon, and Solana, underwent salient losses. Bitcoin peaked back in April, having reached a value of over $30,000—the highest it had been in eight months. Its trading value today was $28,560, reflecting a 2.38% decrease. As a domino effect, Ether too, slid by 2.7 percent.

Even meme coins like DOGE and SHIB failed to gain profits and settled for small losses alongside Avalanche, Chainlink, Cosmos, Uniswap, and Monero. According to CoinMarketCap, a tracking source for crypto assets, the overall market valuation decreased by 1.13% in the last 24 hours, with the market cap standing at $1.18 trillion.

Of late, US’ financial authority (Federal Reserve Board), hiked interest rates, which could have contributed to the declining prices of most cryptocurrencies. Dhruvil Shah, Vice President of Technology at Liminal, a Singaporean digital wallet platform, stated, “[t]he crypto community will be closely watching the FOMC meeting tomorrow for strategizing their next move. It is highly anticipated that the Fed may hike interest rates by 25 basis points as a part of its continued efforts to tame inflation”.

Only a handful of assets recorded profits today, such as Elrond, Cartesi, Underdog, and USD Coin. A newfound stability in the job market and signs of cooling inflation may encourage the Fed to end aggressive rate hikes, which could boost liquidity and drive market momentum in the coming weeks.