Viewpoint: Interest rate hikes won’t prematurely end the crypto market’s bull run. Back in 2021, the sector was hit by the dual headwinds of high interest rates and balance sheet reduction, yet still rallied.
1 hours ago
Jiang Zhuoer, founder of LeBit Mining Pool, published an article titled "Will Interest Rate Hikes Kill the Crypto Bull Market?" The brief conclusion is that such hikes have minimal impact. The growth and internal cycles of the crypto sector far outweigh the influence of interest rate increases. BTC’s full historical chart shows that the 2013 and 2021 bull markets both advanced amid rate hikes or high interest rates, with the 2021 bull market especially facing the dual headwinds of high rates and balance sheet reduction. The crypto space’s ability to shrug off these unfavorable factors stems first from its high growth: a single bull market can deliver gains of over tenfold, making it indifferent to whether interest rates stand at 3% or 5%. Second, the total market capitalization of cryptocurrencies is just a fraction of that of U.S. stocks, so the impact of U.S. stocks diverting new funds exceeds that of the Federal Reserve’s balance sheet reduction.
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