Cryptocurrencies saw a huge rebound on Tuesday, breaking the cycle of major losses that the market saw in the last few days.
Financial markets saw immense volatility as investors moved their cash to safer haven assets. The scrutiny surged after the Federal Reserve’s first policy meeting of the year this week. The Fed hinted that they’ll raise interest rates sooner than expected. Consequently, risky assets saw huge liquidations, while Bitcoin shed 50% of its value.
Technology stocks and speculative assets like Bitcoin and other cryptocurrencies were the largest beneficiaries of the ultra-low interest rates and inflation. However, the era comes like its coming to an end as the Fed moves to raise interest rates. For instance, the Nasdaq 100 index of tech stocks entered the correction territory, while Bitcoin is now trading around the $36,500 level — nearly 50% down from its all-time high of $69,000 that the digital currency reached in November.
However, Bitcoin surged 8% in the last 24 hours after plummeting to a six-month low price of $33,000 this week. Ether, the second-largest cryptocurrency by market value was up 7% at around $2,416, but the digital token is still down 23% on a weekly basis according to data from CoinMarketCap.