Bitcoin Weak for 1 Week...Cryptocurrencies Shaken

Ethereum, Ripple Also Decline

Impact of Lowered Expectations for US Rate Cuts

The price of Bitcoin (BTC) has remained weak for a week, dropping to just above the $110,000 mark. Concerns are growing that the Fed may not cut the key interest rate next month, which is said to have dampened investor sentiment.

According to CoinMarketCap on the 22nd, Bitcoin was trading at around $111,900 at 4:55 am that day. It continued its downward trend even after falling below the $115,000 mark on the 19th. On the 14th, Bitcoin surged to around $124,500, setting a new all-time high, but since then dropped by more than 10%. In Korea, Bitcoin also fell at one point in the morning to around ₩157,200,000.

Ethereum, which had gained much attention earlier this month for its sharp rise compared to Bitcoin, also declined. After breaking through the 4,800-dollar level on the 14th, Ethereum dropped more than 10% over the next eight days, trading on the 22nd around $4,200. Other coins such as Ripple, Solana, and Dogecoin all showed a similar weak trend.

It is said that a series of skeptical remarks about rate cuts from regional Fed presidents acted as a negative factor. Jeffrey Schmidt, president of the Federal Reserve Bank of Kansas City, said in an interview with CNBC that “very decisive data would be needed to move policy rates right now.” This is interpreted to mean that only clear evidence in major economic indicators like inflation would justify a rate cut. Beth Hammack, president of the Federal Reserve Bank of Cleveland, also said on the same day that “it’s hard to find grounds to lower rates, considering recent economic data.”

The US Producer Price Index (PPI) for last month, released on the 14th, rose 3.3% year-on-year, beating the market estimate of 2.5%. As concerns about inflation resurface, expectations for a rate freeze are strengthening.

Jinseong Kim, Reporter jskim1028@hankyung.com