Cryptocurrency Market Plunges Amidst Global Economic Jitters
The cryptocurrency market took a sharp downturn on Sunday evening, sending shockwaves through the industry. Bitcoin plummeted to levels not seen since February, wiping out expectations of a massive surge. Ethereum, meanwhile, fell back to December prices.
Bitcoin dropped by 12% in just 24 hours and is now down 20% for the week. Ethereum's decline was even steeper, with a 21% drop in a day and a 30% loss over the past week. The CoinDesk 20 Index also fell by 12%.
The Bank of Japan's interest rate hike last week may have triggered this market downturn. The yen surged, causing the Nikkei stock index to plummet by 15%. This trend spread to the US, with the Nasdaq dropping over 5% in two days and futures down 2.5% on Sunday evening.
The Federal Reserve's decision to hold rates steady but express uncertainty about a September cut further exacerbated market jitters. Traders have already priced in a 100% chance of lower U.S. rates in September, with a 71% probability of a 50 basis point cut.