Why Bitcoin, Ethereum, and Dogecoin Are Falling Today
Cryptocurrencies lost ground Wednesday as investors continued to attempt to assess the state of the U.S. economy and what steps the Federal Reserve will need to take to rein in high inflation.
As of 1:25 p.m. ET, the price of the world's largest cryptocurrency, Bitcoin (CRYPTO: BTC) had fallen 3.4% over the prior 24 hours. The world's second-largest cryptocurrency, Ethereum (CRYPTO: ETH), had fallen about 4%, and meme token Dogecoin (CRYPTO: DOGE) was off by more than 5%. The stock market was down as well, with the broad S&P 500 index off by about 3.5%
Like many other relatively risky assets such as tech and growth stocks, Bitcoin and most other cryptocurrencies have not fared well recently as interest rates have risen and are on course to head still higher. The Federal Reserve has boosted its overnight benchmark lending rate, the federal funds rate, several times already as it undertakes a fiscal tightening regimen designed to bring inflation back under control. The federal funds rate now sits in the range of 0.75% and 1%, and the price of Bitcoin is down nearly 39% this year.
Source Fool.com
