The Fed’s decision to raise interest rates and the release of US GDP figures had little impact on the cryptocurrency markets. Bitcoin rose around 4% after the Fed announced a 0.75% rate hike Wednesday. GDP figures, however, had less of an impact: after the announcement bitcoin its price fell less than 1%. Negative GDP growth for the second time in a row prompted speculation about the possibility of a US recession.
Does Fed’s Rate Decision Increase Bitcoin (BTC) Accumulation?
Koinfinans.com Besides, as we reported, data shows that small-scale Bitcoin holders are increasingly inclined to accumulate more assets. There seems to be a clear pattern in Bitcoin buying among long-term holders. Since the Fed rate decision, there has been a sharp increase in Bitcoin buying among whales with fewer shares. According to on-chain data, holders of between 1,000 and 10,000 BTC started to accumulate after the Fed’s announcement. Also, according to CryptoQuant analysis, the latest stablecoin entry on exchanges was in preparation for BTC accumulation.
“After yesterday’s Fed rate decision, large investors with 1000-10000 BTC started to increase their reserves. This could explain the massive stablecoin deposits made to exchanges on July 26.”
Accordingly, the Bitcoin price rose around 4% after the Fed announced its decision. At the time of writing, Bitcoin (BTC) is trading at $23,898, up 10% in the last 24 hours.
Doubts Over Crypto Rally
Experts believe that even if there is a long-term crypto market rally thanks to the Fed announcement, it will not be sustainable. Economist Alfonso Peccatiello, author of the record-breaking book The Macro Compass, expressed his doubts about the crypto rally. According to Peccatiello, cryptocurrencies did not start a significant recovery until Powell announced that inflation levels were generally in line with neutral interest rates.
“The crypto market did not start to recover well until Powell announced that inflation levels are generally in line with neutral interest rates.”
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Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.