Cryptos Plummet as Fed Rate Hike Fears Intensify

The crypto market has declined significantly in the past 24 hours, with major cryptocurrencies leading the drop. Bitcoin fell around 2.7% to $63,400, while Ethereum dropped more than 3.2% to $1,874.

But it's not just the crypto market that's experiencing a downturn - stocks are also facing heavy selling. South Korea's tech-heavy KOSPI index plunged 10%, with major chipmakers such as Samsung and SK Hynix facing significant losses.

One of the main reasons for this decline is the upcoming FOMC meeting, where traders are becoming increasingly worried that the Federal Reserve could raise interest rates instead of keeping them unchanged. The odds of a 25-basis-point hike have climbed to around 37%, compared with roughly 10% a week ago.

Higher interest rates can be detrimental to crypto and growth stocks, as investors may prefer safer assets that offer better returns. Additionally, the AI investment boom is being questioned, with concerns about whether investments will generate returns quickly enough.