Fed Rate-Hike Expectations Spark $488M Crypto Liquidation
US Federal Reserve Chairman Kevin Warsh reignited rate-hike expectations at Jackson Hole, sending Bitcoin below $77,000. Data from CryptoSlate shows that Bitcoin dropped to as low as $76,909 before recovering to $77,712 as of press time, down about 4% over the previous 24 hours.
The retreat accelerated a broader crypto deleveraging that erased nearly $488 million from derivatives traders, according to CoinGlass. The selloff followed a sharp repricing of Federal Reserve expectations, with traders lifting the probability of a September rate increase to about 60% from roughly 35% before Warsh spoke.
Warsh argued that inflation remains too high even after better price readings this summer and stated that financial conditions may still be too loose. He said: 'We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do.'