Bitcoin fell below US$19,000 in Thursday morning trading in Asia after briefly moving above that resistance level overnight as investors digested the US Federal Reserve decision to raise interest rates by 75 basis points, or in line with expectations. All the top 10 cryptocurrencies by market capitalization lost ground, with Ether the biggest loser.
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- Bitcoin fell 1.8% in the past 24 hours to trade at US$18,574 at 8 am in Hong Kong. It’s dropped about 9% over the past seven days. Ether fell 5.4% to US$1,252 to mark a 23% slump over the week, according to CoinMarketCap. Solana fell 1.9% to US$30.60, while Dogecoin was trading down 1.8% to US$0.057.
- Bitcoin traded under US$19,000 for most of Wednesday, but spiked to as high as US$19,674 following the Fed’s rate announcement at 5 am Hong Kong and then sharply retreated. US equity markets also fluctuated after the rate release, but then dropped in the last hour of trading as the Fed signaled a more aggressive money tightening into 2023.
- XRP fell 4.5% to US$0.39 after the token’s issuer, Ripple Labs Inc., objected to the US Securities and Exchange Commission statement saying it may seek additional time for concerned parties to submit further documentation in its argument against Ripple. XRP had gained 14.7% over the past seven days as both parties were seeking a summary judgment that would bring an end to the argument that began in December 2020 with the SEC alleging Ripple sold US$1.38 billion worth of unregistered securities.
- US equities fell Wednesday, with the Dow Jones Industrial Average, the S&P 500 Index and the Nasdaq Composite Index all finishing the day about 1.7% lower.
- The Fed announced the rate changes at its scheduled Federal Open Market Committee (FOMC) meeting on Wednesday. Fed Chair Jerome Powell has consistently said the central bank will raise interest rates until inflation hits a target of 2%. The latest consumer price index data showed inflation was running at 8.3% in August.
- “Our expectation has been we would begin to see inflation come down, largely because of supply-side healing,” Powell said in an FOMC press conference. “We haven’t. We have seen some supply side healing but inflation has not really come down.”
See related article: Ripple objects to SEC’s relief suggestion in XRP argument