Crypto Markets Stung by Hawkish Rate Outlook and Inflation Fears

The crypto market is facing significant pressure due to rising macroeconomic fears and a hawkish rate outlook. According to CME's FedWatch tool, there is now a 60.2% chance of a Fed rate hike at the next meeting, fueling inflation concerns.

Bitcoin has extended its decline in recent hours, trading at $77,770 after falling from its high of $79,760 over nearly 14 hours. The massive wave of liquidation in Bitcoin futures, totaling around $386 million, including nearly $270 million in long positions, contributed to the price drop.

The decline was also attributed to a decline in demand for Bitcoin ETFs, with net outflows reaching $166.8 million over two sessions. Long-term investors were selling off their positions, adding to the short-term correction.