What Caused Today’s Crypto Market Crash, Is the Bull Run Over?

February 1, 2023 World Blockchain

During the introduction of the European market, the cryptocurrency market experienced a precipitous decline. The prices of the two most popular cryptocurrencies, Bitcoin and Ethereum, dropped by around 2% in just a few hours, wiping out earlier gains.

Before a crucial week with the Fed rate hike decision and the quarterly results of IT giants, altcoins followed suit and brought about a market-wide drop in the cryptocurrency market.

Why Did the Crypto Market Fall So Quickly?
Bitcoin price fall was anticipated by traders as the surge lacked a pullback. The price of bitcoin continued to rise and even crossed its 200-DMA in January, experiencing a 40% increase.

A hectic week of corporate earnings and central bank meetings, highlighted by anticipated rate increases from the U.S., has investors remaining cautious. the Federal Reserve, the Bank of England, and the European Central Bank.

CME FedWatch Tool estimates that there is a 97.9% chance that the Fed will raise interest rates by 25 basis points during the FOMC meeting. Wall Street economists, though, think investors will have to hold out on the Fed’s turn for a little while longer because a 50 basis point rate hike is still an option.

The European Central Bank will raise interest rates by 50 basis points in February and March. Inflation control efforts are intensifying as the likelihood of a global recession rises.

Bitcoin and Altcoin Prices Suddenly Dropped
The price of one bitcoin is currently $23,259, down 2% in the past few hours. $23,166 is the 24-hour low, and $23,919 is the 24-hour high. On Sunday, the price of BTC climbed as high as $23,861.

The price of Ethereum decreased 2% as well, trading at $1,592 at the moment. Top altcoins including XRP, DOGE, MATIC, ADA, and others have fallen more than 3% in the past day.

Despite the fact that the U.S. With the Dollar Index (DXY) at 101.68, the price of cryptocurrencies fell. As a result, it suggests that investors sold their cryptocurrency holdings before to the Fed rate move.