Bitcoin and Ethereum are both down roughly 50% from the all-time highs they carved out in 2021. Wall Street pundits have been quick to point out that Bitcoin is trading very similarly to the Nasdaq, which has also suffered as the markets pull back. But there are a slew of reasons why the broader markets are getting spooked.
TheStreet's Martin Baccardax wrote, "Surging inflation, aggressive signaling on rate hikes by the Federal Reserve and other central banks, as well as rising bond yields and a resurgent U.S. dollar have all combined to add downward pressure on crypto assets even amidst wider adoption from various governments around the world to either add or compliment bitcoin into its national currencies."
Ross Mac, host of Maconomics, broke down the Bitcoin price level to watch next in the latest episode of the Crypto Minute on TheStreet.
FULL VIDEO TRANSCRIPT BELOW:
Cryptocurrencies are not immune to the stock market sell off, with Bitcoin down over 50% from it's all time highs back in November of 2021.
It’s your boy Ross Mac and this is what cryptocurrency investors are watching on Monday, May 9.
With record inflation and the Federal Reserve no longer accommodating the market; the Fed is instead raising interest rates causing risk assets to be in a free fall. Bitcoin is at its lowest level since July of last year. Now the question is, when will the bleeding stop?
And also, why is Bitcoin trading like tech stocks as opposed to an inflation hedge? Could it be that a ton of tech companies have Bitcoin on their balance sheets? Or could it be that asset managers are seeing elevated levels of redemptions and investors are getting margin calls, and as a result, they are forced to sell Bitcoin?
This week we are getting key U.S inflation data with CPI numbers coming out on Wednesday. If it shows any signs that inflation is peaking, we could get an overall market rebound. If not, we can see Bitcoin fall to as low to the 29,000 range.
It’s your boy Ross Mac and that was the Crypto Minute on TheStreet.
TheStreet's Crypto Minute is brought to you by Blockchain.com.