Bitcoin Breaks Below $80,000 Amid Fed Policy FearsBreaks Below $80,000 Amid Fed Policy Fears
The price of Bitcoin, the world’s largest cryptocurrency, has fallen below the $80,000 mark. On Saturday afternoon New York time, Bitcoin dropped by 6.53 percent to $78,719. The previous day also saw a sharp decline, pushing the digital currency to its lowest level since November, according to Reuters.
Analysts say the downturn is primarily driven by uncertainty surrounding the future policy stance of the US central bank, the Federal Reserve, along with growing concerns over tightening liquidity in the financial system.
Market anxiety has intensified following speculation over Kevin Warsh emerging as a potential new Federal Reserve chair. Warsh is known to support shrinking the central bank’s balance sheet, a move widely interpreted as a signal of liquidity contraction.
Cryptocurrencies are generally viewed as assets that benefit from high liquidity. However, the recent price slump has once again reminded investors of the inherent risks associated with the market.
At the same time, Ether also recorded a steep decline, falling by nearly 12 percent. Market experts believe selling pressure may continue over the coming days.
